Define
What are internal controls?
A system of policies and procedures used to protect assets and ensure accuracy.
Who is responsible for internal controls in an organization?
Management
What does COSO stand for?
Committee of Sponsoring Organizations.
What is Risk assessment?
Identifying and analyzing potential risks.
What must organizations establish to maintain controls?
Policies and procedures
What is the main purpose of internal controls?
To prevent fraud and errors.
Who oversees internal controls at a higher level?
Board of Directors
How many components are in the COSO model?
Five
Why is risk assessment important?
Helps prevent problems before they occur.
What must organizations do regularly to controls?
Monitor and update them.
What do internal controls help ensure in financial reporting?
Accuracy and reliability
What department often evaluates internal controls?
Internal auditors
Name one COSO componet?
control environment, risk assessment, control activities, info and communication, monitoring
Risk assessment helps organizations do what?
Make better decisions
Why is training important for internal controls?
Ensure employees follow procedures.
Internal controls also help organizations comply with what?
Laws and regulations.
Are employees responsible for following internal controls?
yes
Which component focuses on identifying risks?
Risk assessment.
What types of risks are evaluated?
Financial, operational, compliance.
What happens if controls are weak?
Increased risk of fraud/errors
What are internal controls designed to safeguard?
Assets and information.
Who sets the tone for internal control culture?
leadership/management
Which component ensures ongoing evaluation of controls?
Monitoring
Risk assessment is a part of which model?
COSO
Organizations must ensure controls are what?
Effective and efficient