AUD1201 QUIZ 1

Governance component to which the internal auditing is most concerned and risk management and control activities are most likely to be applied:

• A. Strategic direction

• B. External assurance activities

• C. Oversight

• D. Ethical climate

Which party performs the day-to-day governance functions?

• A. Board

• B. CEO and CAE

• C. Management

• D. Internal auditors

Organizational culture affects the overall control environment and individual engagement risks and controls. Who is primarily responsible for the establishment and maintenance of the organizational culture?

• A. Board

• B. Internal audit activity

• C. CAE

• D. Senior management

Which party is responsible in determining that risk management processes are established, adequate, and effective as part of its direct function?

• A. Management

• B. Senior management

• C. Chief audit executive

• D. Board

Who is primarily responsible in keeping an eye over the organization's ethical climate?

• A. Senior management

• B. Internal audit activity

• C. External consultant

• D. Organization's director

Which of the below can lead to the effectiveness of an organization's governance processes?

• A. Consideration of risk in the setting of strategy.

• B. Not relying on controls to manage risks.

• C. Organization's governance independence from risk management and control processes.

• D. All of the above.

If the internal auditors are responsible for the evaluation of an organization's governance processes, the board and management are then responsible for?

• A. Assessment of governance processes adequacy and effectiveness

• B. Design and implementation of governance processes.

• C. Oversight function only.

• D. Oversight and independent evaluation of the governance processes' design and effectiveness.

An action taken by the management, the board, and other parties to manage risk.

• A. Risk

• B. Control

• C. Control environment

• D. Control management

Policies, procedures, and activities which are part of a control framework designed to mitigate risks.

• A. Risk

• B. Control

• C. Control environment

• D. Control processes

An independent and objective board with sufficient expertise, experience, authority, and resources to conduct independent inquiries is a principle under which of the following?

• A. Governance

• B. Risk management

• C. Control

• D. None of the above