Audit Readiness CRAGE Practice Questions (Page 11)

Questions 51–53

1. 51application · medium

   A retail company uses an AI system for inventory forecasting. An internal audit readiness review found that the system's model cards are outdated and do not reflect recent changes to the algorithm. The company has a regulatory obligation to maintain accurate documentation. What should the company do to address this gap?

   • AWait until the next scheduled audit to update the model cards
   • BRemove the model cards from the documentation to avoid discrepancies
   • CUpdate the model cards to reflect the current algorithm and establish a process for regular reviews
   • DRevert the algorithm to the version described in the old model cards
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2. 52application · medium

   A multinational retailer is preparing for an internal audit of its AI-driven inventory forecasting system. The audit will cover data governance, model development, and operational monitoring. The audit team has been formed, but roles are unclear. The data science team believes they are responsible for everything, while the legal team expects to review all documentation. Which assignment of responsibilities best supports audit readiness?

   • ALegal reviews all documentation and decides what is relevant, while other teams provide raw data on request.
   • BData science owns model development evidence, IT owns infrastructure logs, legal owns regulatory interpretation, and compliance coordinates the overall readiness.
   • CIT is responsible for everything because the AI system runs on their infrastructure.
   • DData science is solely responsible for all audit evidence, including legal and IT documentation.
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3. 53application · medium

   A bank's AI fraud detection system is subject to an upcoming regulatory audit. The internal gap analysis revealed that the system's risk management framework does not explicitly address model drift. The bank has a remediation plan but limited resources. What is the most appropriate remediation action?

   • ARemove the model drift issue from the risk framework to simplify the audit
   • BImplement a basic monitoring solution that only tracks accuracy
   • CDocument the gap as a known limitation and defer remediation until after the audit
   • DPrioritize the model drift gap as high-risk and allocate resources to implement drift monitoring
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