ACCA · Question 15 · Internal Control
SECTION A - CASE 3: GLOBAL WATER INITIATIVE
SCENARIO:
Global Water Initiative (GWI) is an international NGO providing clean water solutions in developing nations. You are advising the board on corporate governance and internal audit. GWI currently does not have an internal audit department. The board consists of the CEO, the CFO, and two non-executive directors (NEDs), one of whom is the CEO's brother. GWI receives significant grant funding, which requires strict compliance with donor conditions. Recently, a whistleblower alleged that procurement contracts in a regional office were awarded to a company owned by the regional director.
QUESTION:
To improve governance, GWI is advised to establish an Audit Committee. Which of the following best describes the role of the Audit Committee in relation to internal controls?
Answer options:
To design and implement the internal control systems across the organization.
To review the adequacy and effectiveness of the organization's internal control and risk management systems.
To authorize all procurement contracts above a certain financial threshold.
To act as the primary point of contact for the regional directors regarding daily operational issues.
18 questions · hints · full answers · grading
Expert