Question

Which of the following statements is true? (Check all that apply.)

	A.	Cost-effective controls should be implemented to reduce risk.
	B.	Risk should never be accepted, even if it is within the company’s risk tolerance range.
	C.	The benefits of implementing controls are generally easier to quantify accurately than are the costs of implementing controls.
	D.	In evaluating internal controls, management must consider factors other than those in the expected cost/benefit calculation.

Answer 1

Option A is true - Cost effective controls should be implemented as its important to reduce the cost in an effective manner and when cost is reduced it reduces the risk as well

Option B is False - Without accepting risk business can never be done , risk can be upon the nature of the business man but it is impossible to irradicate risk

Option C is false - Nothing is easy , it is equally difficult to do both of them

Option D is false - In evaluating internal controls the management should consider that the planned ways of performing a task are actually executed and are not only on paper