Organizational Dynamics Flashcards
type of hierarchical structure that relies on rules,
regulations, and a strict span of control to ensure that everyone does their job efficiently and effectively.
Mechanistic Organization
Chain of Command
Centralized decision-making
Fixed Structure
Tall Reporting Hierarchies
Strict Reporting Hierarchies
Characteristics of a Mechanistic Organization
The form of an organization that has a low degree of formality, specialization, and standardization. Used in dynamic and unstable environments where the business needs to quickly adapt to change, as it has the flexibility to deal with fast paced environmental change.
This is: flexible and open to change, employees can make their own decisions, collaboration is encouraged, and IT IS FLAT.
Organic Structure
A party that has an interest in a company and can either affect or be affected by a business.
Stakeholder
They provide effective oversight through election of board members and approval of major initiatives.
Shareholders
They provide accurate and timely reports to shareholders and other stakeholders.
Management
Perform assigned tasks efficiently and effectively
Employees
They ensure accuracy, timeliness, and fairness of public reporting of financial and other information to public companies.
They set accounting and auditing standards, identify fraud, investigate causes, and suggest remedial actions.
Regulators
TRUE OR FALSE: Internal auditors adhere to the “International Standards for the Professional Practice of Internal Auditing.”
True
TRUE OR FALSE: The purpose, authority, and responsibility of the internal audit activity must be informally defined in an internal audit charter.
False (They must be formally defined)
TRUE OR FALSE: The CAE should periodically review the internal audit charter and present it to senior management and the board for approval.
True
TRUE OR FALSE: The internal audit activity must be independent, and internal auditors must be subjective in performing their work.
False (they must be objective)
TRUE OR FALSE: The CAE must develop and maintain a quality assurance and improvement program that covers some aspects of the internal audit activity.
False (it must cover all aspects)
TRUE OR FALSE: The CAE must effectively manage the internal audit activity to ensure it adds value to the organization.
True
TRUE OR FALSE: The internal audit activity must evaluate and contribute to the improvement of the organization’s governance, risk management, and control processes using an ad-hoc approach.
False (It must use a systematic, disciplined, and risk-based approach)
