QUIZ NO.

3
ACCT 1163 – OPERATIONAL AUDITING Date: Feb. 21, 2023

A. Multiple Choice: Choose the letter represents the best answer.

1. The establishment of a Board and corporate manual of policies and guidelines exemplifies
which COSO ERM framework component?
a. Performance
b. Governance and Culture
c. Strategy and Objective Setting
d. Review and Revision

2. Which of the following is closely linked to risk acceptance?

a. Risk detection
b. Risk prevention
c. Risk tolerance
d. Risk correction

3. The conduct of regular monitoring of activities and updating of the risk management
documents, procedures and guidelines demonstrates which COSO ERM framework
component?
a. Performance
b. Governance and Culture
c. Strategy and Objective Setting
d. Review and Revision

4. The conduct of SWOT analysis, Stakeholders analysis and organizational planning forms
part of which COSO ERM framework component?
a. Performance
b. Governance and Culture
c. Strategy and Objective Setting
d. Review and Revision

5. The preparation and accomplishment of a risk register to identify and assess risks
demonstrates which COSO ERM framework component?
a. Performance
b. Governance and Culture
c. Strategy and Objective Setting
d. Review and Revision

6. Which of the following risk concepts can be assumed to have no mitigating controls?
a. Business risk
b. Residual risk
c. Inherent risk
QUIZ NO. 3
ACCT 1163 – OPERATIONAL AUDITING Date: Feb. 21, 2023

d. Current risk

B. For items 7-12, write the letter of the corresponding activity to the appropriate column in the
table based on internal audit’s role in ERM.

Internal Auditing roles in Internal Auditing roles in Roles internal auditing should
ERM (Assurance role) ERM with safeguards not undertake (Management
(Consulting role) responsibility)
7. E 9. C 11. A
8. F 10. D 12. B

A. Implementing risk responses

B. Setting the risk appetite
C. Coordinating ERM activities
D. Championing the establishment of ERM
E. Reviewing the management of key risks
F. Evaluating the risk management processes

C. For items 13-15, determine the most appropriate risk mitigation approach to the following
risks based on the risk map below.
13. A concrete grocery store’s risk of getting burned down. All electrical wirings are properly
installed, and inventory of goods are stored well. (B)
14. Shoplifting of small food items from the grocery store’s display shelves. The grocery store
has high foot-traffic of shoppers. (C)
15. Risk of inventory shortage for small-value products with low turnover. (D)