GRC Internal Controls & Audit Processes

Question 1

What is the purpose of internal controls?

Accepted Answer

Ensure accuracy and compliance

Answer

Increase risk of fraud

Answer

Decrease operational efficiency

Answer

Promote risk acceptance

Question 2

What is the role of auditing in internal controls?

Accepted Answer

Assess and ensure control effectiveness

Answer

Increase risk exposure

Answer

Ignore compliance issues

Answer

Promote fraud

Question 3

What is segregation of duties in internal controls?

Accepted Answer

Divide responsibilities to prevent errors and fraud

Answer

Increase task duplication

Answer

Centralize decision-making

Answer

Increase control over staff

Question 4

What is an audit trail?

Accepted Answer

A record of activities for audit purposes

Answer

A log of all staff actions

Answer

A report of all financial data

Answer

A list of financial statements

Question 5

What is the primary objective of an internal audit?

Accepted Answer

Evaluate controls and compliance

Answer

Increase operational costs

Answer

Limit financial reporting

Answer

Promote internal inefficiency

Question 6

What is risk assessment in the context of internal controls?

Accepted Answer

Identify, evaluate, and prioritize risks

Answer

Ignore potential risks

Answer

Increase risk exposure

Answer

Delay assessments

Question 7

What is a key benefit of effective internal controls?

Accepted Answer

Detect and prevent errors and fraud

Answer

Increase errors and fraud

Answer

Decrease transparency

Answer

Increase liability

Question 8

How does continuous monitoring enhance internal controls?

Accepted Answer

Ensure consistent application and adaptation

Answer

Reduce monitoring frequency

Answer

Increase risk exposure

Answer

Delay changes

Question 9

Why is segregation of duties important in internal controls?

Accepted Answer

Reduce fraud and errors

Answer

Increase fraud opportunities

Answer

Consolidate control

Answer

Increase workload