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3- Risk Management & Internal Controls questions with answers.
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3- Risk Management & Internal Controlsquestions with answers.
the process that specifically mitigates risks to the company's financial information ANS -Internal Controls
the mechanisms, like rules, policies, or procedures, that make up the process of internal controls ANS -
Controls
prevent problems from happening ANS -Preventive Controls
type of preventive control that lessens the risk of error and fraud by ensuring that different employees
are responsible for the separate parts of a business activity of authorizing, recording, and having custody
ANS -Segregation/ Separation of Duties
alert management to an issue once it has occurred ANS -Detective Controls
change undesirable outcomes and occur after a risk has occurred ANS -Corrective Controls
is when internal control activities don't work because management is not following policy or procedure,
like telling a direct report to ignore a specific control ANS -Management Override
when two employees work together to circumvent controls ANS -Collusion
measures the residual risk for technology attacks by comparing the
relationship of the three control functions ANS -Time-Based Model of Controls
apply to the entire operation of the full system and its environment such as; all corporate applications,
email, web browsers, time keeping software, benefits management systems, etc. ANS -IT General
Controls
, a software that captures and records accounting business events ANS -Application
when a control only applies to a specific application - including all the business processes and accounts
that are linked to it ANS -Application Controls
might sound antiquated, but they play a significant role because they are used when human judgement
or physical interaction is required ANS -Manual Controls
use technology to implement a control activity ANS -Automated Controls
technology to create detective controls that use rules-based programming to monitor the business' data
for red flags of risks ANS -Continuous Monitoring
Ownership and the responsibility of enforcing mitigating measures to prevent identified risk from
occurring ANS -Management - business operations
Identifying and assessing organizational risks ANS -Management - risk management and compliance
Aids the first line of defense by ensuring controls are designed to adequately address risk, then monitors
to ensure fist line is complying with internal control requirements ANS -Management - risk management
and compliance
An independent function of the company that has a unique reporting relationship in an organization ANS
-Internal audit
shows how far along a company is on its journey to reach the ideal state by comparing the current state
to a predetermined set of best practices ANS -Maturity Model
a. Informal process
b. Ad hoc controls
c. Localized efforts
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