Untitled Deck Flashcards
What does COSO stand for?
Committee of Sponsoring Organizations of the Treadway Commission
True or False: COSO ERM focuses solely on financial risks.
False
Fill in the blank: COSO ERM is a framework for __________ management.
enterprise risk
What is the primary purpose of the COSO ERM framework?
To improve risk management and enhance organizational performance.
Which component of COSO ERM involves understanding the organization’s internal and external environment?
Context
Multiple Choice: Which of the following is NOT a component of the COSO ERM framework? A) Governance, B) Risk Assessment, C) Financial Reporting, D) Monitoring
C) Financial Reporting
What is the first step in the COSO ERM process?
Establishing the context
True or False: Risk appetite is defined as the amount and type of risk an organization is willing to take.
True
What is meant by ‘risk tolerance’ in the context of COSO ERM?
The specific maximum risk that an organization is willing to take regarding a particular risk.
List the five components of the COSO ERM framework.
Governance, Risk Assessment, Risk Response, Information & Communication, Monitoring
What does the ‘Risk Assessment’ component of COSO ERM involve?
Identifying and analyzing risks to achieve objectives.
Multiple Choice: Which component of COSO ERM focuses on ensuring the effectiveness of risk management processes? A) Governance, B) Risk Response, C) Monitoring, D) Context
C) Monitoring
What is the role of ‘Risk Response’ in the COSO ERM framework?
To determine how to manage risks that have been identified and assessed.
True or False: COSO ERM is only applicable to large organizations.
False
What does the term ‘risk culture’ refer to in COSO ERM?
The values and behaviors of an organization that shape its approach to risk management.
Fill in the blank: The COSO ERM framework aims to integrate risk management into __________ decision-making.
strategic
Multiple Choice: Which of the following is a benefit of implementing COSO ERM? A) Increased compliance costs, B) Improved decision-making, C) Reduced transparency, D) Decreased stakeholder confidence
B) Improved decision-making
What is the significance of ‘Information & Communication’ in the COSO ERM framework?
It ensures that relevant risk information is communicated throughout the organization.
True or False: The COSO ERM framework is static and does not require updates.
False
What is a key feature of the COSO ERM framework regarding risk management?
It promotes a holistic approach to risk management across the organization.
Fill in the blank: The COSO ERM framework helps organizations align their risk management with __________ strategies.
business
What is the relationship between COSO ERM and regulatory compliance?
COSO ERM supports compliance by promoting effective risk management practices.
Multiple Choice: Which of the following best describes ‘risk management’? A) Avoiding all risks, B) Understanding and managing risks to achieve objectives, C) Only focusing on financial risks, D) Ignoring risks entirely.
B) Understanding and managing risks to achieve objectives
What is the significance of ‘Monitoring’ in the COSO ERM framework?
It involves ongoing evaluations to ensure the risk management process is effective.
