Study Unit 1 - Business processes, Risks, and Internal Controls Flashcards
1
Q
What are the 4 general types of business risk?
A
1 - Strategic risk
2 - Compliance risk
3 - Reporting risk
4 - Operational risk
External reporting risks - related to FS, tax filings & valuations
Internal reporting risks - IC, budgeting, KPI (key performance indicators)
2
Q
Risks are measured in terms of…
A
A - Probability - risk that an event will have an impact on achieving objectives
B - Impact - magnitude in terms of financial loss and non-monetary (eg. safety)
3
Q
The assess and report phase of an effective approach to monitoring internal controls consist of :
A
1 - Prioritizing findings
2 - Reporting results to appropriate levels
3 - Following up on corrective actions
