A company establishing an internal audit department is an example of which internal control component?
A. Monitoring Processes
B. Control Environment
C. Information and Communication System
D. Risk Assessment
Answer (2)
An internal audit department is an example of the Monitoring Processes component of internal controls. This component evaluates and ensures the effectiveness of internal controls within an organization. Other components like Control Environment, Information and Communication System, and Risk Assessment also exist but do not specifically represent the establishment of an audit department. ;
The correct answer to the question is A. Monitoring Processes, as establishing an internal audit department is focused on evaluating and ensuring the effectiveness of internal controls. This department continuously assesses and reports on the adequacy of various processes within the organization. Monitoring Processes is essential for maintaining compliance and enhancing operational performance.
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