Corporate Governance - Entity-Level Controls - Monitoring Control Effectiveness

Question 1

Internal controls are likely to fail if:

Answer 1

they are not designed and implemented properly, are static in nature (i.e., the control does not adapt to changes in the operating environment), or change operationally.

Control activities are only designed to provide reasonable assurance related to the achievement of the stated objectives. Internal control will fail if the control is not designed, implemented, monitored, and modified for operational changes.

Question 2

If the control is designed and implemented properly, and the design changes as processes change,

Answer 2

then the control should not fail.