Evaluate inherent risks and residual risks
Multiple Choice
1. The Global Organizational Hierarchy (GOH) can include all of the following except:
a. Divisions
b. Risks
c. Business Units
d. Activities
2. An entity’s contributors may include:
a. Auditors but not contacts
b. Contacts but not auditors
c. Neither auditor nor contacts, only TeamRisk administrators
d. Both auditors and contacts
3. Which of the following risk assessment elements are not stored in TeamStore?
a. Risks
b. Objectives
c. Entities
d. Controls
4. Which of the following statements regarding the self-assessment process is incorrect?
a. Self-assessment allows both auditors and contacts to provide input for a risk assessment.
b. Self-assessments are performed using a web-based interface called TeamRisk Web.
c. Self-assessment scores automatically update the final risk score for the entity without any action required by the audit department.
d. Self-assessments can allow for the contact or audit partner to identify additional risks.
5. When building an internal audit plan in TeamRisk, the system provides all of the following information except:
a. Risk score by entity
b. The estimated start date of the audit
c. Cycle-driven requirement status
d. Whether or not the entity is already linked to an existing internal audit engagement
True/False
6. The Risk and Controls Library is static and cannot be changed once it is setup.
a. True
b. False
7. Classification of Risks is limited to the following types: Operational, Financial, Compliance, and Strategic.
a. True
b. False
8. When identifying entities for the internal audit plan, only one entity may be linked to each audit engagement for the year.
a. True
b. False
Discussion Questions
9. Explain the difference between evaluating inherent risks and residual risks, and how TeamRisk facilitates the evaluation process.
10. Explain the purpose of the Global Organizational Hierarchy and its relationshipwith the COSO ERM framework.
Critical ThinkingTask
1. Create a Global Organizational Hierarchy for Champion Pharmaceutical, Inc. (CPI) using the information about the company provided in the Introduction to the TeamMate Practice Case. Then choose one entity,define two objectives for that entity, anddescribe two risks that threaten the achievement of each objective.
2. Using the HeatMap reports in Appendix A and Appendix B, identify the three highest priority internal audit engagements.Justify your reasoning for eachengagement identified.
