Nancy Talked to Two Friends Who Had Recently Worked on Developing

question 52

Essay

Nancy talked to two friends who had recently worked on developing enterprise risk management plans; one project was successful, but the other was not. Determine which statements in the list below were associated with the successful project; then, identify the element of the COSO enterprise risk management framework that most clearly applies.
A. Backup power supplies and adequate insurance are good ideas.
B. I'd say the risk is moderate to high at an inherent level, but we can probably reduce it if we implement some new procedures.
C. I'm glad the president let us bring in a speaker about ERM before the project got started.
D. If we have a power outage, our cooling systems could fail, leading to damaged inventory.
E. Let's put together a memo that explains the work we've done to everyone in the company.
F. Our costs are out of control, so let's cut them by 10%.
G. Our goal is to lose no more than 1% of our inventory due to spoilage.
H. Should we simply accept the risk? Or should we try another way of reacting to it?
i. The operations manager and inventory control clerks can let us know how the process is working.j. We need to make the company more profitable.k. Why would anyone outside inventory control need to know what we've done?

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Definitions:

Tunic

In a biological context, a fibrous or cellular covering layer, such as that surrounding certain seeds or the body of sea squirts and other invertebrates.

Adult Tunicates

Marine invertebrates that are members of the subphylum Tunicata; they are sessile as adults and have a sac-like body covered with a tunic.

Filter Feeders

Organisms that feed by straining suspended matter and food particles from water, typically using a specialized filtering structure.

Lancelets

Lancelets are small, blade-like marine animals belonging to the subphylum Cephalochordata, exhibiting key characteristics of chordates, such as a notochord and a dorsal nerve cord.