In an assurance engagement focused on the adequacy of organization wide risk management practices, which of the following best describes a primary area of interest for the engagement?

In an assurance engagement focused on the adequacy of organization wide risk management practices, which of the following best describes a primary area of interest for the engagement?
A . The effectiveness of process-level and transaction-level controls.
B . Conflicts of interest within the organizational structure of the senior management.
C . The alignment of management decisions with the level of risk the organization is willing to accept.
D . The actions of upper management in response to the internal audit activity’s reporting

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Answer: C

Explanation:

In an assurance engagement examining the adequacy of organization-wide risk management practices, a primary area of interest would be the alignment of management decisions with the level of risk the organization is willing to accept. This focus helps determine whether the risk management framework is effectively informing strategic decision-making and aligning with the business objectives and risk appetite of the organization. Effective risk management practices should guide management in making decisions that align with the entity’s predefined risk thresholds.

Reference: The Institute of Internal Auditors (IIA) – International Standards for the Professional Practice of Internal Auditing