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2 Organizational Governance Online Quiz Questions

Use this free practice quiz with 20 questions to review 2 Organizational Governance, test your knowledge, and prepare for your next test or exam.

20 questions
01
True or false
1 point

A sound governance system should clarify responsibilities and accountability while leaving daily operations to management within its delegated authority. True or false?

  1. A

    True

  2. B

    False

02
Choose one
1 point

An organization wants managers to make routine staffing decisions while retaining oversight of its overall direction. Which arrangement best fits the distinction between oversight and management?

  1. A

    The governing body sets direction and oversees management.

  2. B

    The governing body makes every routine operational decision.

  3. C

    Internal audit assumes responsibility for the activities it audits.

  4. D

    Senior management approves the governing body's oversight responsibilities.

03
Written response
1 point

What is the name of the model that distinguishes operational risk management, specialist support and monitoring, and independent internal audit assurance?

04
Fill in the blank
1 point

To make clear which people or activities a policy covers, the policy should state its .

05
Choose one
1 point

A policy appears to conflict with an applicable regulation. Which response best follows the governance principles described in the material?

  1. A

    Review and align the governance documents with applicable law and regulation.

  2. B

    Assume the policy takes precedence because it is more specific.

  3. C

    Ignore the inconsistency unless a violation has already occurred.

  4. D

    Ask internal audit to take over management of the affected activity.

06
Choose all
1 point

A team is preparing a material organizational decision. Which actions are consistent with a sound decision process? Select all that apply.

  1. A

    Identify who has authority to make the decision.

  2. B

    Determine who should be consulted and what evidence is needed.

  3. C

    Consider alternatives, conflicts of interest, and effects on stakeholders.

  4. D

    For a material matter, record the decision, rationale, conditions, and responsibilities.

  5. E

    Avoid documenting the rationale so the decision-maker can revise it without review.

  6. F

    Treat delegated authority as a reason to stop monitoring the matter.

07
True or false
1 point

An audit committee may provide focused oversight, but its existence does not automatically remove the governing body's ultimate responsibility. True or false?

  1. A

    True

  2. B

    False

08
Fill in the blank
1 point

After delegating a major decision, the governing body should still receive timely, reliable information and maintain .

09
Written response
1 point

What is the name of the board structure in which executive and non-executive directors sit together?

10
Choose one
1 point

A manager asks internal audit to run a process so that the auditors can later assess whether it is controlled effectively. What is the most appropriate response?

  1. A

    Take over management of the activity so that its controls can be tested directly.

  2. B

    Provide independent assurance without assuming management's responsibility.

  3. C

    Approve operational decisions before management can act.

  4. D

    Replace the governing body when reporting significant risks.

11
Choose all
1 point

An organization wants to strengthen accountability beyond simply assigning people responsibilities. Which practices would help? Select all that apply.

  1. A

    Provide protected channels for concerns and investigate them consistently.

  2. B

    Evaluate leaders and confirm that corrective actions address identified problems.

  3. C

    Maintain decision logs that allow material decisions to be reviewed.

  4. D

    Allow people to bypass approval limits whenever deadlines are tight.

  5. E

    Treat reporting exceptions as a substitute for follow-up.

12
Choose one
1 point

A policy has been formally approved, but employees do not understand it and leaders ignore violations. What change would make the policy more effective?

  1. A

    Keep the policy available only to senior management.

  2. B

    Use the written policy as a substitute for supporting controls.

  3. C

    Communicate the policy, support it with controls, and respond appropriately to violations.

  4. D

    Avoid reviewing the policy after material organizational changes.

13
Open ended
1 point

A governing body delegates routine staffing decisions to senior management. Later, a significant new risk emerges that may affect the organization's staffing plan. Explain what management should do and how the governing body should preserve oversight without taking over routine operations.

14
Choose one
1 point

A board establishes an audit committee to focus on financial reporting and internal controls. Which statement best describes the committee's role?

  1. A

    They take over the governing body's ultimate responsibility for the organization.

  2. B

    They provide focused oversight in areas such as financial reporting or significant risks.

  3. C

    They manage routine operations on behalf of senior management.

  4. D

    They replace the need for the governing body to monitor performance.

15
True or false
1 point

A governing body delegates routine operational decisions to managers. To maintain good governance, should the governing body continue to oversee performance and retain its oversight role?

  1. A

    True

  2. B

    False

16
Written response
1 point

What is the governance structure called when an organization separates its supervisory board from its management board?

17
Choose one
1 point

An organization is clarifying risk responsibilities using the Three Lines Model. Which arrangement best reflects the model?

  1. A

    Specialist functions own all operational risks, while management independently audits them.

  2. B

    Internal audit owns risks and directs operational teams in managing them.

  3. C

    Operational management owns and manages risks, specialist functions support and monitor risk management, and internal audit provides independent assurance.

  4. D

    The governing body manages every operational risk directly.

18
Choose one
1 point

An organization is revising a policy so employees can apply it consistently, including when unusual circumstances arise. Which policy feature would best address those circumstances?

  1. A

    Specify what people should do when an exception applies.

  2. B

    Avoid describing responsibilities so employees can decide who is accountable.

  3. C

    State general principles but omit required actions and consequences.

  4. D

    Remain unchanged even when material organizational changes occur.

19
Written response
1 point

Which function provides independent, objective assurance on governance, risk management, and controls, and should not take over management's responsibility for activities it audits?

20
Choose one
1 point

A management team makes a material decision after considering legal, financial, and risk information. What should its decision record include to support accountability?

  1. A

    Record only the final decision, leaving its rationale and responsibilities undocumented.

  2. B

    Allow the decision-maker to omit relevant evidence if the decision is urgent.

  3. C

    Avoid recording decisions so they can be revised without review.

  4. D

    Record the decision, its rationale and conditions, and who is responsible for follow-up.