Even MORE Major Keys Flashcards
WHAT are Four of the Components of ERM?
(1) Internal environment
(2) Objective setting
(3) Event identification
(4) Risk assessment
WHAT are Four of the Components of ERM?
(5) Risk response
(6) Control activities
(7) Information and communication
(8) Monitoring
Under COSO, WHAT are effective approaches to monitoring internal controls?
(a) Establishing a foundation for monitoring
(b) Assessing and reporting the results, including following up on corrective action where necessary
(c) Designing and executing monitoring procedures that are prioritized based on risks to achieve organizational objectives
WHAT would be considered management capabilities under ERM?
- Risk appetite and strategy
- Risk response decisions
- Operational surprises and losses
- Multiple and cross-enterprise risks
- Opportunities
- Deployment of capital
WHAT are the roles and responsibilities of internal auditors who work in enterprise risk management (ERM)?
(1) Coordinating ERM activities
(2) Giving assurance that the risks of the organization are correctly evaluated
(3) Evaluating the risk-management process
WHAT are factors that are a part of an entity’s control environment?
(1) Integrity and ethical values
(2) Assignment of authority
(3) Human resource practices
HOW is the function of the Chief Risk Officer (CRO) most effective?
WHEN they are supported by a specific team with the necessary expertise and experience related to organization-wide risk
E.g. WHEN he monitors risk as part of the enterprise risk management team
WHAT is Senior Management’s responsibility when it comes to the Control Environment?
TO establish a proper ethical culture
E.g. Senior Management sets the “Tone at the Top” by demonstrating integrity and ethical values
WHAT level of the organization are Control Activities carried out at?
Various levels within the organization
NOTE: They may be preventive OR detective
WHAT would be considered “Ongoing Evaluations?”
- The presence or absence of customer complaints
- Reports of external or internal auditors
- Training Seminars
What is a determining factor in separate evaluations of internal controls?
The significance of risks
E.g. This determines the scope and frequency of separate internal control evaluations
WHAT senior executive positions is the Board of Director’s responsible for selecting?
The Chief Executive Officer (CEO) and the Senior Vice President
WHAT are the roles and responsibilities of the Internal Auditor?
To evaluate the adequacy and effectiveness of internal controls in response to risks
E.g. they evaluate controls over:
(1) Achievement of the organizations strategic objectives
(2) Reliability and integrity of financial and operational information
WHAT are some other roles and responsibilities of the Internal Auditor?
TO evaluate controls over:
(1) Effectiveness and efficiency of operations and programs
(2) Safeguarding of Assets
(3) Compliance with laws, regulations, standards, policies, procedures and contracts
WHAT is an independence factor to consider regarding the Internal Auditor?
They (Internal Auditor) cannot be responsible for selecting and executing controls to remain independent
