Internal Controls & Risk Assessment Flashcards
6 cards from real CAT practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Internal Controls & Risk Assessment flashcards as text
What is the first step in the risk management process for Certified Accounting Technician?
Answer: Identifying potential risks and hazards
Risk identification is the first step, as you must know what risks exist before you can assess and manage them.
In Certified Accounting Technician, what is a risk matrix used for?
Answer: Evaluating risks based on likelihood and impact
A risk matrix plots risks on a grid of likelihood versus impact, helping prioritize which risks need the most attention.
What does risk mitigation mean in Certified Accounting Technician practice?
Answer: Taking steps to reduce the likelihood or impact of identified risks
Risk mitigation involves implementing strategies to reduce either the probability of a risk occurring or its potential impact.
Which risk response strategy involves transferring risk to a third party in Certified Accounting Technician?
Answer: Transfer (e.g., insurance)
Risk transfer shifts the financial or operational impact of a risk to another party, commonly through insurance or contracts.
What is a risk register in Certified Accounting Technician practice?
Answer: A documented list of identified risks with their analysis and response plans
A risk register is a document that records all identified risks, their assessment, and planned responses for tracking and management.
When should risk assessments be updated in Certified Accounting Technician?
Answer: Regularly and whenever significant changes occur
Risk assessments should be living documents, updated regularly and whenever there are significant changes in conditions, processes, or scope.