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.

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Definitions:

Expected Return

The predicted average return on an investment calculated by adding together all possible returns weighted by the likelihood of each occurring.

Asset Allocation Strategy

A method of investment where an individual divides their investment portfolio among various asset categories, such as stocks, bonds, and cash, to optimize risk and return.

Go Global

A strategy or approach aimed at expanding business operations internationally to access larger markets and opportunities.

U.S. Equity

Shares that represent ownership in U.S.-based companies and can be traded on American stock exchanges.