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BEC CPA Exam (1)
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Exam of 6 pages for the course CISA: Domain #2, Part A: IT Governance at CISA: Domain #2, Part A: IT Governance (BEC CPA Exam (1))
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BEC CPA ExamCOSO Framework assists Management and the Board of Directors by: - ANS-Effectively
applying Internal Control
Determining the requirements of an effective system
Allow judgement and flexibility in the design of I/C
Identify and analyze risks, and develop effective responses
Eliminate redundant, ineffective, or inefficient controls
Extend I/C application beyond financial reporting
Three Objective of COSO Framework - ANS-Operations, Reporting, Compliance Objectives
Operations Objective - ANS-The effectiveness and efficiency of an entity's operations. Include
operational and financial performance goals, as well as safeguarding assets
Reporting Objective - ANS-Reliability, timeliness, and transparency of an entity's external and
internal financial and non-financial reporting
Financial Reporting Objective - ANS-- Make sure financial statements are reported fairly in
accordance with GAAP
- Present relevant and material information
Financial Reporting Risks - ANS-- Risk that financial statements are not in accordance with
GAAP
Fraud Risk - ANS-- Represents risk of material misstatement as a result of fraud
Compliance Objective - ANS-Entity is adhering to all applicable laws and regulations
COSO Components of I/C - ANS-Control Environment
Risk Assessment
Information and Communication
Monitoring
Existing Control Activities
COSO Component - Control Environment - ANS-Processes, structures, and standards that
provide the foundation for an entity to establish a system of I/C.
Established through "tone at the top"
-Commit to ethics/integrity
-Board independence/oversight
-Organizational structure
-Commit to competence
, -Accountability
COSO Component - Risk Assessment - ANS-Entity's identification and analysis of risks
-Specify Objectives --> CREATES OBJECTIVES
-Identify/Analyze risks
-Consider potential fraud
-Identify/assess changes
COSO Component - Information and Communication - ANS-Support identification, capture, and
exchange of information in a timely/useful manner.
-Obtain and Use info
-Internal Communication
-External Communication
Obtain and Use information - ANS-Entity obtains/generates or and uses relevant, high quality
information to support function of I/C
COSO Component - Monitoring Activities - ANS-Process of Assessing the quality of I/C
performance over time by assessing design/operation of controls, and taking necessary
corrective action
- Ongoing separate evaluations
- Communication of deficiencies
COSO Component - Existing Control Activities - ANS-Set forth by entity's policies and
procedures to ensure management directives are in place
-Select/Develop I/C activities,
-Technology controls
-Deploy through policy/procedure
Enterprise Risk Management - ANS-COSO issued ERM, to assist organizations in developing
responses to risk. Apply strategy across enterprise to ID events, manage risk appetite, provide
reasonable assurance
-All entity's exist to create SH value
-Intent is to effectively deal with uncertainty, evaluate risk, build value
-Value Maximized when strategy balances risk/return and efficiency/effectiveness
ERM objectives - ANS-Strategic - high level goals to achieve mission
Operations - achieve objectives, effective/efficient use
Reporting- Reliable/consistent reporting
Compliance- Laws/Regulations
ERM Components - ANS-- Internal Environment
- Set Objectives
- Event ID
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