Internal Control & Risk Management Exam With 100% Correct Answers 2024

Internal Control & Risk Management Exam With 100% Correct Answers 2024 D. Risk event - correct answer-1. In a risk assessment process, if a control objective is to ensure employees protect their passwords, which of the following would describe an employee leaving password on a note taped to the monitor? * A. Risk response B. Residual risk C. Inherent risk D. Risk event A. Reviewing and cancelling supporting documents when a check is issued. - correct answer-2. Which of the following controls would help prevent overpaying a vendor? * A. Reviewing and cancelling supporting documents when a check is issued. B. Requiring the check signer to mail the check directly to the vendor. C. Reviewing the accounting distribution for the expenditure. D. Approving the purchase before ordering from the vendor. A. Purchasing procedures are well designed and are followed unless otherwise directed by the purchasing supervisor. - correct answer-3. Which of the following describes a control weakness? * A. Purchasing procedures are well designed and are followed unless otherwise directed by the purchasing supervisor. B. Pre-numbered blank purchase orders are secured within the purchasing department. C. Normal operational purchases fall in the range from P5,000 to P10,000 with 2 signatures required for purchases over P10,000. D. The purchasing agent invests in a publicly traded mutual fund that lists the stock of one of the organization's suppliers in its portfolio. D. Preparing attendance data and preparing the payroll - correct answer-One payroll engagement objective is to determine whether segregation of duties is proper. Which of the following activities is incompatible? * A. Hiring employees and authorizing changes in pay rates B. Preparing the payroll and filing payroll tax forms C. Signing and distributing payroll checks D. Preparing attendance data and preparing the payroll B. Harm to the firm's reputation - correct answer-5. In a risk assessment process regarding the possibility of management override of controls to manipulate reported earnings, which of the following is an impact factor of such an event occuring? * A. Management turnover levels B. Harm to the firm's reputation C. Complexity of accounting methods D. Loose ethical standards set at the top C.Petty cash is kept in a high traffic area, and the organization doesn't use an imprest account system. - correct answer-6. Which of the following best describes an event that would be placed on a low impact, high likelihood area of a risk map? * A. Employees could find a way to bypass the automated controls over Web surfing and thus waste time. B. Computer output sits at the printer after it is printed, and valuable material could end up in competitor's hands. C. Petty cash is kept in a high traffic area, and the organization doesn't use an imprest account system. D. Downsizing consolidates the check signing & check authorization functions in the controller job role B. Control is the result of proper planning, organizing and directing by management. - correct answer-.7. Which of the following best defines control? * A. Control accomplishes objectives and goals in an accurate, timely and economical fashion. B. Control is the result of proper planning, organizing and directing by management. C. Controls are statements of what the organization chooses to accomplish. D. Control is provided when cost-effective measures are taken to restrict deviations to a tolerable level. D.Major improvement in competitor's product - correct answer-8. Which of the following is a risk? * A. Commitment to competence B. Code of ethics C. Personnel policy manual D. Major improvement in competitor's product B.The amount of risk that an organization is prepared to accept, tolerate or be exposed to at any point in time. ¬ - correct answer-9. Which of the following refers to risk appetite? * A. The decision to accept, avoid, reduce or share a risk B. The amount of risk that an organization is prepared to accept, tolerate or be exposed to at any point in time. C. The acceptable variation relative to performance to the achievement of objectives D. Some risks will only be treatable or containable to acceptable levels. B. Monitoring and learning activities - correct answer-10. Which of the following is not a component of COSO model? * A. Control environment B. Monitoring and learning activities C. Control activities D. Risk assessment