Processes of Monitoring Internal Control

Question 1

Define “ongoing monitoring”

Answer 1

Activities to monitor the effectiveness of IC in the ordinary course of operations.

Question 2

What are the 3 elements of establishing a foundation for control?

Answer 2

1. The tone at the top
2. Organizational structure
3. Baseline understanding of control effectiveness

Question 3

Define an internal control deficiency

Answer 3

A condition requiring attention. May represent a perceived, potential or real shortcoming, or an opportunity to strengthen the system to increase the likelihood of achieving objectives.

Question 4

Define “control baseline”

Answer 4

A starting point for control monitoring. A control assessment that provides sufficient, persuasive info to support a conclusion about control effectiveness, either across the entire organization or in a given area.

Question 5

List the 4 activities that comprise the Design and Execution of Control Monitoring

Answer 5

1. Prioritize risks
2. Identify controls
3. Identify persuasive info about controls
4. Implement monitoring procedures

Question 6

Name the 3 activities that comprise Assessing and Reporting on control monitoring:

Answer 6

1. Prioritize findings
2. Report results as appropriate
3. Follow up to implement corrective actions