Which element of internal control does this best relate to?

A financial services firm conducts regular internal audits to evaluate the effectiveness of its internal controls and make necessary improvements.

Question

Which element of internal control does this best relate to?

A financial services firm conducts regular internal audits to evaluate the effectiveness of its internal controls and make necessary improvements.

BlackTom AI · Accepted Answer

Question restatement: The scenario asks which element of internal control best relates to a firm conducting regular internal audits to evaluate the effectiveness of its internal controls and make improvements.

Since the answer provided is Monitoring, we will focus on explaining why monitoring fits and what it encompasses within internal control.

Option/theme discussion (centered on Monitoring):
- Monitoring as a control component involves ongoing or separate evaluations to ensure that other control activities are operating as intended over time. Regular internal audits are a classic mechanism for this ongoing oversight, identifying deficiencies, and prompting improvements. This aligns with the intent of monitoring to verify that controls remain effective and are updated as needed.
- The audits function as a feedback loop: they assess the design and operating effectiveness of controls and then drive remediation efforts, which is the essence of monitoring in internal control frameworks.

If there were other options to contrast with Monitoring (not provided here), typical differentiations might include:
- Control activities: policies and procedures that take effect to address identified risks; audits would assess these rather than being the activity itself.
- Risk assessment: the process of identifying and analyzing risks to achieving objectives; audits inform risk assessment by revealing actual control gaps.
- Information and communication: the systems and channels that convey information relevant to control and risk; audits rely on these but are not the information channel itself.
- Control environment: the tone at the top and the organizational culture; audits may reflect results influenced by the control environment but are not the environment itself.

Practical reasoning: Regular internal audits demonstrate a formalized approach to monitoring, providing independent assurance about the state of internal controls, and supporting continuous improvement. This makes Monitoring the best fit for the described activity.

In summary, the core idea behind Monitoring is the ongoing assessment and remediation cycle that audits provide, ensuring controls stay effective; this is precisely what the scenario describes. If alternative options existed, they would describe other components of internal control, but would not capture the evaluative and corrective function that audits embody as effectively as Monitoring does.

Which element of internal control does this best relate to? A financial services firm conducts regular internal audits to evaluate the effectiveness of its internal controls and make necessary improvements.

查看解析

登录即可查看完整答案

类似问题

Which of the following is not an overall primary objective of the COSO framework?

Match the following examples to the correct component of internal control. 1: Control environment 2: Monitoring 3: Control activities

Match the following examples to the correct component of internal control. 1: Control environment 2: Risk assessment 3: Control activites 4: Monitoring 5: Information and communication

Match the example to the correct component of internal control. 1: Control environment 2: Control activities 3: Risk assessment

Question at position 31 Which of the following is an objective of COSO’s internal control framework:Compliance objectives.Control environment.Information and communication.Monitoring Activities.

The purpose of a _____ is to safeguard assets, optimize the use of the organization’s resources and prevent or detect errors or fraud.

Question at position 3 Monitoring internal control systems is the primary responsibility of the:Board of directors.Senior management.External auditors.Internal auditors.

更多留学生实用工具

考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单