A. 1 and 3 only

B. 1 and 4 only

C. 2 and 3 only

D. 2 and 4 only

A. Management assurance on risks.

B. Implementing risk responses on behalf of management.

C. Providing assurance that risks assessed are correctly evaluated.

D. Setting the risk appetite.

A. Outsourced business processes should not be considered in the internal audit universe because the controls are owned by the external service provider.

B. Generally, independence is improved when the internal audit activity reviews outsourced business processes.

C. The key controls of outsourced business processes typically are more difficult to audit because they are designed and managed externally.

D. The system of internal controls may be better and more efficient when the business process is outsourced compared to internally sourced.

A. Set clear objectives.

B. Engage the various communities of practice within the organization.

C. Demonstrate support from senior management.

D. Establish key competencies.

A. The strategy is favored when unit costs fall with the increase in units produced.

B. The strategy is favored when buyers are relatively insensitive to price increases.

C. The strategy is favored when there is insufficient market capacity and competitors cannot increase market capacity.

D. The strategy is favored when high price is perceived as high quality.

A. The average time per customer inquiry should be kept to a minimum.

B. Customer complaints should be processed promptly.

C. Employees should maintain a positive attitude when dealing with customers.

D. All customer inquiries should be answered within seven days of receipt.