Corporate Governance Flashcards
The principle of obtain and use information is used when?
When the organization obtains and uses relevant high quality information to support the functioning of the control
The treadway commission was established by?
Private sponsoring organizations
COSO prepared the internal control integrated framework to do what?
Help businesses assess internal control
Insuring against losses or entering into joint ventures to address risk is known as?
Risk sharing
A response to risk that involves the diversification of products offerings rather than elimination of product offerings is?
Risk reduction
When management uses listings of potential events common to a specific industry as a means of identifying risks or opportunities, the method is known as?
event inventory
Residual risk is what?
The risk that remains after management responds to the risk
Sox requires that the audit committee be independent with regard to the issuer. What corporate officers would be considered independent? Independent auditor? Board member?
Independent auditor no, board member yes
Risk appetite has generally been exceeded when?
The likelihood and impact of negative events significantly exceeds residual risk
Broad, company wide objectives are what kind of objective?
Strategic objective
Establishing objectives that will support the mission and vision of an organization generally involve supporting the mission with
Strategic objectives, supported by strategies and related objectives
The principle that protects corporate directors from personal liability for acts performed in good faith on behalf of the corporation is known as
The business judgment rule
ERM focuses on what goals?
Providing reasonable assurances that objectives and goals are achieved
Achievement of financial and performance targets
Risk assessment and mitigation
What are the eight components of COSO
Internal environment
Setting objectives
Event identification
Assessment of risk
Risk response
Activities
Information and communication
Monitoring
A situation when a company implements new technology and hires an individual to help document new policies and procedures and develop training is an example of what?
Change management
