Mẹo Which of the following statement is incorrect with respect to internal audits and management reviews?
Mẹo Hướng dẫn Which of the following statement is incorrect with respect to internal audits and management reviews? Chi Tiết
Bùi Quỳnh Anh đang tìm kiếm từ khóa Which of the following statement is incorrect with respect to internal audits and management reviews? được Cập Nhật vào lúc : 2022-08-28 01:08:02 . Với phương châm chia sẻ Kinh Nghiệm Hướng dẫn trong nội dung bài viết một cách Chi Tiết 2022. Nếu sau khi tham khảo tài liệu vẫn ko hiểu thì hoàn toàn có thể lại Comment ở cuối bài để Tác giả lý giải và hướng dẫn lại nha.16.The audit committee of the board of directors of a company is responsiblefor
Nội dung chính- The ins and outs of the Three Lines of Defence model and the benefits and challenges of implementation.What is the Three Lines of Defence model?Is the model applicable to any organisation?The key benefits of implementing an effective model When implementation of the model failsThree lines of
defence in depthWhich of the following statements is an incorrect
description of the role of internal auditors?Which of the following is not the role of
internal audit department?Which of the following statements is not a distinction between independent auditors and internal auditors?Which of the following actions by the internal auditor relates to the internal audit principle of objectivity?Which of the following statements is an incorrect description of the role of internal auditors?Which of the following statement is false in auditing?Which of the following statements is not a distinction between independent auditors and internal auditors?Which one of the following is the major purpose of performing analytical procedures in internal audits?
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17.The AICPA remains a valuable organization because of its continuinginvolvement in
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18.The objective of an operational audit is toa.evaluate whether laws have been broken by management.b.evaluate fairness of presentation of financial statements.c.evaluate compliances with company rules and regulations.d.evaluate the effectiveness and efficiency with which resources areemployed.
19.Congress authorized which of the following organizations to establishgenerally accepted accounting principles for public companies?
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20.The public expects auditors to
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83.Which of the following statements is anincorrectdescription of the role of internal auditors?A.Internal auditors should review the means of minimizing risks and assist management processes.B.Internal auditors should assess risks within the business operations and those from outside the business.C.Internal auditors should appraise the economy and efficiency with which resources are employed.D.Internal auditors should have authority and responsibility for the activities they audit.
84.Which of the following statement isnottrue in respect of the internal auditor?
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85.Which of the following groups could be involved in an operational audit?
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86.Which isnotone of the three phases in an operational audit?
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87.In performing an operational audit, the auditor primarily relies on which of the following procedures?A.Physical inspectionB.Analytical proceduresC.Inquiry and observationD.Tracing and vouching
88.The term "efficiency" in performance auditing refers to
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89.Before an effectiveness audit can be performed, there must be
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Nội dung chính
- The ins and outs of the Three Lines of Defence model and the benefits and challenges of implementation.What is the Three Lines of Defence model?Is the model applicable to any organisation?
The key benefits of implementing an effective model When implementation
of the model failsThree lines of defence in depthWhich of the following statements is an incorrect description of the role of internal auditors?Which of the following is not the role of internal audit department?Which of the following statements is not a distinction between independent auditors and internal auditors?Which of the following actions by the internal auditor relates to the internal audit principle of objectivity?
The ins and outs of the Three Lines of Defence model and the benefits and challenges of implementation.
The Institute of Internal Auditors (IIA) published a global position paper in 2013, titled: The Three Lines of Defense in Effective Risk Management and Control.
The concept has remained sufficiently important that a further position paper was published in June 2022 by the Chartered Institute of Internal Auditors, titled: The Three Lines of Defence, hereafter the 2022 paper.
The 2022 paper stated:
‘Applying the three lines of defence model in an organisation is not a silver bullet for achieving effective internal audit.
‘Much also depends for example on the standing, scope and resourcing of the internal audit function.
‘However, if the positioning and governance structure for internal audit are wrong, its ability to support the board or audit committee in their challenging of management can be fatally undermined’.
What is the Three Lines of Defence model?
The IIA and the Institute of Directors endorse the 'Three Lines of Defence' model as a way of explaining the relationship between these functions and as a guide to how responsibilities should be divided:
Source: CIAA websiteThree lines of defenceThe first line of defence (functions that own and manage risks)
This is formed by managers and staff who are responsible for identifying and managing risk as part of their accountability for achieving objectives. Collectively, they should have the necessary knowledge, skills, information, and authority to operate the relevant policies and procedures of risk control. This requires an understanding of the company, its objectives, the environment in which it operates, and the risks it faces.
The second line of defence (functions that oversee or who specialise in compliance or the management of risk)This provides the policies, frameworks, tools, techniques and support to enable risk and compliance to be managed in the first line, conducts monitoring to judge how effectively they are doing it, and helps ensure consistency of definitions and measurement of risk.
The third line of defence (functions that provide independent assurance)This is provided by internal audit. Sitting outside the risk management processes of the first two lines of defence, its main roles are to ensure that the first two lines are operating effectively and advise how they could be improved. Tasked by, and reporting to the board / audit committee, it provides an evaluation, through a risk-based approach, on the effectiveness of governance, risk management, and internal control to the organisation’s governing body toàn thân and senior management. It can also give assurance to sector regulators and external auditors that appropriate controls and processes are in place and are operating effectively.
Is the model applicable to any organisation?
In short, yes.
The 2013 paper stated that the three lines of defence model is ‘appropriate for any organisation – regardless of size or complexity. Even in organizations where a formal risk management framework or system does not exist, the Three Lines of Defense model can enhance clarity regarding risks and controls and help improve the effectiveness of risk management systems’.
The IIA position papers are part of their ‘Strongly Recommended’ category of guidance and compliance is not mandatory.
The key benefits of implementing an effective model
To implement an effective and efficient model across an organisation is not simple and requires vision and ongoing support from the Board and executive management in terms of direction and resources. Benefits are:
- Improved coverage of risks and controls by identifying and refining where necessary the population of risks and controls,
and appropriately allocating the ownership and performance of these risks and controls across the lines of defence. Consequently, any unintended risks and gaps in controls may be avoided, and unnecessary duplication of work should be avoided by removing layers of redundant controls;Improved control culture across the organisation by enhancing the understanding of risks and controls. For example, potential conflicts of interest or incompatible responsibilities may
be more readily identified and challenged with those risks then either removed or mitigated; andImproved reporting to the Board and executive management through a coordinated approach to providing timely and insightful reporting avoiding potentially duplicative and irrelevant information.
When implementation of the model fails
The Financial Stability Institute published Occasional Paper No 11 ‘The four lines of defence model’ for financial institutions in December 2015.
The paper included a root cause analysis of how the implementation of the lines of defence model arguably failed in practice during significant banking scandals with the following key findings:
- Misaligned incentives for risk-takers in the first line of defence – management may have put greater emphasis on and set compensation [or career progress] based on the achievement of financial objectives rather than control-orientated
objectives;Lack of organisational independence of functions in second line of defence;Lack of skills and expertise in second line functions; andInadequate and subjective risk assessment performed by internal audit. Failure by Internal Audit to identify high-risk areas or processes will lead to audits focussing on the wrong areas therefore undermining the effectiveness of the third line of defence.
Three lines of defence in depth
For an explanation of the role of Internal Audit in the three lines of defence model and some of the practical day-to-day challenges of implementation under an often-ongoing climate of ‘doing more with less’ watch our for the second article on this topic ‘Internal audit: challenges of implementation'.
Which of the following statements is an incorrect description of the role of internal auditors?
The correct answer is a. Internal auditors are not permitted to assist external auditors because it would compromise the external auditor's independence. It is an incorrect statement because internal auditors assist external auditors during the auditing process to provide them with all the needed information.
Which of the following is not the role of internal audit department?
The scope of the internal audit function does not include an assessment of the company's strategic management process.
Which of the following statements is not a distinction between independent auditors and internal auditors?
ANSWER: C 16. Which of the following statements is not a distinction between independent auditing and internal auditing? a. Independent auditors represent third party users external to the auditee entity, whereas internal auditors report directly to management.
Which of the following actions by the internal auditor relates to the internal audit principle of objectivity?
Correct Answer Rule of Conduct 2.3 under the objectivity principle states, "Internal auditors shall disclose all material facts known to them that, if not disclosed, may distort the reporting of activities under review."
Which of the following statements is an incorrect description of the role of internal auditors?
The correct answer is a. Internal auditors are not permitted to assist external auditors because it would compromise the external auditor's independence. It is an incorrect statement because internal auditors assist external auditors during the auditing process to provide them with all the needed information.Which of the following statement is false in auditing?
Detailed Solution. the false statement is in an audit, accounts and records are not verified in a truthful and fair manner.Which of the following statements is not a distinction between independent auditors and internal auditors?
ANSWER: C 16. Which of the following statements is not a distinction between independent auditing and internal auditing? a. Independent auditors represent third party users external to the auditee entity, whereas internal auditors report directly to management.Which one of the following is the major purpose of performing analytical procedures in internal audits?
The purpose of applying analytical procedures in planning the audit is to assist in planning the nature, timing, and extent of auditing procedures that will be used to obtain evidential matter for specific account balances or classes of transactions. Tải thêm tài liệu liên quan đến nội dung bài viết Which of the following statement is incorrect with respect to internal audits and management reviews?
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