CRMA CRMA - Certification in Risk Management Assurance Risk Monitoring and Reporting Questions and Answers 3

Question 1

The audit committee asks internal audit to assess whether the organization's KRI thresholds are appropriately calibrated. What should the auditor evaluate?

Accepted Answer

Whether thresholds align with the board-approved risk appetite and reflect realistic trigger points for action

Answer

KRI thresholds must be grounded in the organization's own risk appetite and set at levels that genuinely prompt timely action.

Question 2

Which of the following BEST supports a continuous risk monitoring approach rather than periodic point-in-time assessments?

Accepted Answer

Automated data feeds from operational systems that update risk metrics in near real time

Answer

Continuous monitoring relies on automated data integration so that risk metrics reflect current conditions rather than a snapshot in time.

Question 3

When preparing a risk report for the audit committee, an auditor should ensure the report includes which of the following to be most useful?

Accepted Answer

Risk trends over time, changes in residual risk, KRI status, and management's planned responses to out-of-tolerance risks

Answer

Audit committee risk reports should show trend direction, current exposure levels, and management's accountability for addressing exceptions.

Question 4

An organization discovers that a material risk was not reported to the board for six months because the responsible risk owner did not escalate it. What corrective action addresses the ROOT CAUSE?

Accepted Answer

Redesign the escalation protocol to include automatic triggers and independent oversight that do not rely solely on risk owner discretion

Answer

Sole reliance on voluntary escalation by risk owners creates a single point of failure; systemic controls like automated triggers remove this dependency.

Question 5

Which stakeholder is ultimately responsible for approving the organization's risk appetite statement that underpins KRI thresholds?

Accepted Answer

The board of directors

Answer

Risk appetite is a governance matter that requires board approval because it defines the level of risk the organization is willing to accept in pursuit of its strategy.

(CRMA) Certification in Risk Management Assurance Practice Test

(CRMA) Certification in Risk Management Assurance Practice Test

CRMA CRMA - Certification in Risk Management Assurance Risk Monitoring and Reporting Questions and Answers 3