CCA Internal Controls & Risk Management 3

Question 1

Which of the following is an example of a preventive control rather than a detective control?

Accepted Answer

Password authentication requirements

Answer

Preventive controls like password authentication stop errors or fraud before they occur, unlike detective controls that identify issues after the fact.

Question 2

Enterprise Risk Management (ERM) under COSO 2017 is organized around how many components?

Accepted Answer

8

Answer

COSO's 2017 ERM framework is organized around 5 components and 20 principles, with 8 being associated with the older 2004 framework components.

Question 3

A key risk indicator (KRI) differs from a key performance indicator (KPI) in that a KRI:

Accepted Answer

Signals the likelihood of future adverse events

Answer

KRIs are forward-looking metrics that provide early warning signals of increasing risk exposure before issues materialize.

Question 4

Which control environment factor relates to management's demonstrated commitment to competence and ethical values?

Accepted Answer

Tone at the top

Answer

Tone at the top reflects the ethical values, integrity, and commitment to internal control demonstrated by senior leadership.

Question 5

When assessing internal control effectiveness, an auditor identifies a deficiency where controls might not prevent or detect a material misstatement. This is classified as a:

Accepted Answer

Material weakness

Answer

A material weakness is a deficiency or combination of deficiencies in internal control where there is a reasonable possibility that a material misstatement will not be prevented or detected.

(CCA) Certified Corporate Accountant Practice Test

(CCA) Certified Corporate Accountant Practice Test

CCA Internal Controls & Risk Management 3