Governance, Ethics, and Risk Management Overview

Questions and Answers

What is the primary purpose of the course described in the overview?

To enable professionals to enhance governance and risk management (correct)

To prepare students for the workforce

To develop skills in creative writing

To provide knowledge of basic accounting principles

Which framework is covered in the course related to Corporate Governance?

Environmental Protection Framework

SEC Code of Corporate Governance (correct)

ISO 9001 Quality Management System

International Financial Reporting Standards

What aspect of internal controls is addressed in the course under the audit process?

Creating financial projections

Testing employee performance

Understanding the entity and its environment (correct)

Designing a marketing strategy

Which of the following is NOT a focus of the course?

Development of entrepreneurial skills Signup and view all the answers

In what professional examination will this subject be included?

Certified Public Accountant Licensure Examination Signup and view all the answers

Effective risk management primarily aims to:

Minimize the potential negative impact of risks Signup and view all the answers

Business ethics primarily address which of the following concerns?

Moral principles that guide business conduct Signup and view all the answers

Internal controls are primarily designed to:

Enhance the efficiency and effectiveness of operations Signup and view all the answers

What role does the Board play in risk management?

It sets the organization’s risk appetite. Signup and view all the answers

Which line of defense is focused on management control?

First line of defense Signup and view all the answers

How do effective governance and internal controls interact?

Effective governance relies on strong internal controls. Signup and view all the answers

Which aspect is NOT typically influenced by governance?

Employee performance appraisals Signup and view all the answers

What is the primary responsibility of senior management regarding risk management?

To implement the Board's risk management strategies. Signup and view all the answers

In the context of governance, which control can help manage compliance and fraud risks?

Code of conduct Signup and view all the answers

What is the role of internal audit in the Three Lines of Defense model?

It operates as the third line of defense. Signup and view all the answers

What must the Board do to assure itself that senior management is addressing risks appropriately?

Set mechanisms for ongoing review. Signup and view all the answers

What percentage of the 2019 CIA Exam Syllabus, Part 1, is dedicated to Governance, Risk Management, and Control?

35% Signup and view all the answers

Which of the following modules focuses specifically on the SEC Code of Corporate Governance?

Module 3 Signup and view all the answers

What is one of the expected outcomes for students by the end of the semester in relation to internal auditing?

Perform an audit engagement with minimal supervision Signup and view all the answers

Which of the following is NOT mentioned as a module in the course materials?

Evaluation of Financial Reports Signup and view all the answers

According to the overview, how do Governance, Risk Management, and Internal Control contribute to an organization?

By providing reasonable assurance that objectives will be achieved Signup and view all the answers

Which publication is relevant to the concept of Enterprise Risk Management?

ISO 31000:2018 Signup and view all the answers

What is one of the key components of corporate governance covered in the course?

Independence and objectivity Signup and view all the answers

The course emphasizes the need to apply which of the following in internal auditing?

Business acumen and IT knowledge Signup and view all the answers

Study Notes

Overview of Governance, Business Ethics, Risk Management, and Internal Control

Course geared towards BSA and BSMA students to enhance organizational governance, risk management, and internal control.
Relevant for Certified Public Accountant Licensure Examination, covering regulatory frameworks and audit processes.
Strong relationship exists between governance, risk management, and control.

Governance and Risk Management Relationships

Governance sets the overall direction for risk management activities, integrating risk considerations into strategy formulation.
Effective governance relies on robust internal controls; efficient communication is dependent on these controls.
Internal control is essential for implementing risk management strategies and ensuring compliance and fraud risk mitigation.
The Board of Directors determines the organization’s risk appetite and oversees management's risk response.

Three Lines of Defense Model

First line of defense: Management control, which directly manages risks.
Second line of defense: Risk control and compliance oversight functions established by management.
Third line of defense: Internal Audit, providing independent assurance.

Course Objectives

Students will acquire knowledge of professional standards expected of accountants.
Understanding of corporate governance, risk management, and internal control is essential.
Application of business acumen, IT, and management skills within internal auditing is required.
Ability to evaluate risks and internal controls using appropriate tools and techniques.
Students will conduct audit engagements with minimal supervision according to professional standards.

Course Modules

Module 1: Internal Auditing
Module 2: Conceptual Framework of Corporate Governance
Module 3: SEC Code of Corporate Governance
Module 4: Business Ethics, CSR, and Sustainability
Module 5: Fundamentals of Risk and Risk Management Process
Module 6: Enterprise Risk Management
Module 7: Basic Concepts and Elements of Internal Control
Module 8: Evaluating the Effectiveness of Internal Control
Module 9: Fraud Risks

References for Course Materials

IIA’s International Standards for Professional Practice of Internal Auditing.
Philippine frameworks for assurance engagements and corporate governance codes.
G20/OECD Principles of Corporate Governance and various ISO standards.
COSO frameworks related to risk management and internal control.

Key Takeaway

Governance, risk management, and internal control are integral to achieving organizational objectives and provide a framework for accountability and performance enhancement.

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Description

Explore the vital connections between governance, business ethics, risk management, and internal controls in this course geared for BSA and BSMA students. This quiz covers critical frameworks and practices essential for passing the CPA Licensure Examination, including the role of the Board of Directors in risk oversight.