The Enterprise Risk Management (ERM)framework Is Based on the 1992

question 69

Multiple Choice

The Enterprise Risk Management (ERM) framework is based on the 1992 COSO report and adds three additional components for an effective internal control system.Which of the following is not one of those three?

• A)Objective setting
• B)Event identification
• C)Control assessment
• D)Risk response

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Definitions:

Bernoulli's Theorem

A principle in probability that describes the behavior of binomial distributions under certain conditions.

Utility Theory

A framework in economics and finance that analyzes choices under uncertainty, emphasizing the satisfaction or utility derived from each possible outcome.

Central Limit Theorem

A statistical theory stating that the sampling distribution of the sample mean approaches a normal distribution as the sample size becomes large, regardless of the shape of the population distribution.

Expected Opportunity Loss

The expected loss resulting from not choosing the best alternative action.