As a manager in her firm, Lucy concerns herself with the effectiveness of internal controls. Her main focus is how efficient and effective the company's internal controls are over time. Which component of internal control is Lucy engaging in?
A) Risk assessment
B) Control activities
C) Control environment
D) Monitoring

Question

Quizplus · Accepted Answer

Monitoring is the component of internal control that focuses on evaluating the effectiveness of the system over time. Lucy's concern with the effectiveness of internal controls falls under this category. Risk assessment involves identifying potential risks and their impact on the organization, control activities involve the policies and procedures put in place to mitigate risks, and control environment refers to the overall tone and culture in the organization that supports the effectiveness of internal controls.

As a Manager in Her Firm, Lucy Concerns Herself with the Effectiveness