Define the COSO component "Monitoring"
A)to identify risks to the entity's ability to achieve its objectives
B)the procedures used by the company to help it achieve its objectives
C)systems to exchange the information needed to make decisions
D)to determine whether internal controls effectively prevent misstatements or detect misstatements in the financial statements

Question

Quizplus · Accepted Answer

Monitoring is the COSO component that involves regular assessments of the internal control system to determine whether internal controls effectively prevent or detect misstatements in the financial statements. It requires ongoing monitoring activities and separate evaluations to assess the effectiveness of internal controls over time. Monitoring activities should be designed to identify and remediate internal control deficiencies on a timely basis.  Options A, B, and C relate to other COSO components (Risk Assessment, Control Activities, and Information and Communication, respectively).

Define the COSO Component "Monitoring