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| Section | Objectives |
|---|---|
| Topic 1: Assurance of Risk Management | - Reporting risk and assurance results - Assurance mapping - Internal audit assurance over ERM |
| Topic 2: Risk Response and Mitigation | - Control design and evaluation - Risk treatment strategies - Monitoring risk responses |
| Topic 3: Risk Management Governance | - Three lines model / internal audit role - Risk oversight responsibilities - Organizational governance structures |
| Topic 4: Risk Identification and Assessment | - Risk prioritization techniques - Risk assessment frameworks - Risk identification methods |
1. What is the primary purpose of a fishbone diagram?
A) To identify the possible causes of adverse conditions.
B) To depict the areas of responsibility for departments in an organization.
C) To plan and control complex projects, such as internal audits.
D) To represent the frequencies of adverse conditions in a given process.
2. Which of the following are components of the COSO enterprise risk management framework?
1. Objective setting.
2. External environment.
3. Data collection.
4. Control activities.
A) 2 and 3 only
B) 1 and 4 only
C) 2 and 4 only
D) 1 and 3 only
3. Which segregation of duties would best reduce the risk of payroll fraud?
A) Human resources personnel add employees, and payroll personnel process hours and enter employee bank account numbers. Paychecks are automatically deposited in the employee's bank account.
B) Human resources personnel add employees and enter employee bank information. Payroll personnel process hours, and paychecks are automatically deposited in the employee's bank account.
C) Human resources personnel add employees, review and submit payroll hours to the payroll department for processing, and deliver paychecks to employees.
D) Human resources personnel add employees, payroll personnel process hours, and human resources personnel deliver paychecks to employees.
4. A government agency maintains a system of internal control, according to the COSO model, and has made a change to its employee performance reviews and rewards program. This change relates to which of the following components of COSO's internal control framework?
A) Information and communication.
B) Monitoring activities.
C) Control activities.
D) Control environment.
5. According to the International Professional Practices Framework, which of the following are allowable activities for an internal auditor?
1. Advocating the establishment of a risk management function.
2. Identifying and evaluating significant risk exposures during audit engagements.
3. Developing a risk response for the organization if there is no chief risk officer.
4. Benchmarking risk management activities with other organizations.
5. Documenting risk mitigation strategies and techniques.
A) 1.2. 4. and 5 only.
B) 2. 3. 4. and 5 only.
C) 1.2, and 3 only.
D) 4 and 5 only.
Solutions:
| Question # 1 Answer: A | Question # 2 Answer: B | Question # 3 Answer: A | Question # 4 Answer: D | Question # 5 Answer: A |
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