ExpertMedium1 markMultiple Choice
CPA · Question 08 · Area I: Business Analysis
Under the COSO Enterprise Risk Management (ERM) framework (2017), which of the following is a principle related to the 'Governance and Culture' component?
Under the COSO Enterprise Risk Management (ERM) framework (2017), which of the following is a principle related to the 'Governance and Culture' component?
Answer options:
A.
Analyzes business context
B.
Identifies risk
C.
Leverages information and technology
D.
Demonstrates commitment to core values
How to approach this question
Recall the 5 components of COSO ERM (GOPRO - Governance, Objective-setting, Performance, Review, Ongoing info). Map 'Core Values' to Governance/Culture.
Full Answer
D.Demonstrates commitment to core values✓ Correct
The Governance and Culture component sets the organization's tone, reinforcing the importance of, and establishing oversight responsibilities for, enterprise risk management. Demonstrating commitment to core values is a key principle here.
Common mistakes
Confusing Governance principles with Strategy or Performance principles.
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