Which is the least effective form of risk management?

Answer(s): D

Which of the following should be incorporated in a risk management policy?

Boundaries and limit structures.
II. Requirements for reporting risk.
III. Risk authorities.
I and IIonly
I and IIIonly
II and IIIonly
I,II,and III.

Answer(s): D

In an assurance engagement of treasury operations, an internal auditor is required to consider all of the following issues except:

The audit committee has requested assurance on the treasury department's compliance with a new policy on the use of financial instruments.
Treasury management has not instituted any risk management policies.
Due to the recent sale of a division,the amount of cash and marketable securities managed by the treasury department has increased by 350 percent.
The external auditors have indicated some difficulties in obtaining account confirmations.

Answer(s): D

Regarding an organization's decision to retain an external audit firm, the chief audit executive (CAE) should:

Work with the organization's chief financial officer to evaluate the external auditor's performance and together make the decision.
Not be involved in this decision process as it would compromise the CAE's objectivity.
Evaluate the external auditor's performance and retain the external auditor if quality and cost criteria are met.
Assist the audit committee by facilitating the development of an appropriate evaluation process.

Answer(s): D

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