Which of the Following Describes the Risk Assessment Component of Internal

question 102

Multiple Choice

Which of the following describes the risk assessment component of internal control?

• A) Internal auditors monitor company controls to safeguard assets, and external auditors monitor the controls to ensure that the accounting records are accurate.
• B) Risk assessment is the "tone at the top" of the business.
• C) A company must identify its risks and take necessary steps to minimize them.
• D) Risk assessment is designed to ensure that the business's goals are achieved.

---

Definitions:

Sensorimotor Stage

The first of Jean Piaget's stages of cognitive development, where infants learn about the world around them through their senses and motor activities.

Object Permanence

The understanding that objects continue to exist even when they cannot be seen, heard, touched, smelled, or sensed in any way.

Theory of Mind

The capacity to recognize and understand one's own and others' mental states, such as beliefs, intentions, desires, and emotions, realizing that others may have perspectives and thoughts distinct from our own.

Capacity for Abstract Reasoning

The capacity to contemplate concepts, principles, and entities that are not tangible or visible.