ExpertHard1 markMultiple Choice
CPA · Question 62 · Area III: SOC Engagements
Which of the following is a 'Risk Response' strategy where the company decides to stop the activity that causes the risk?
Which of the following is a 'Risk Response' strategy where the company decides to stop the activity that causes the risk?
Answer options:
A.
Risk Mitigation
B.
Risk Acceptance
C.
Risk Avoidance
D.
Risk Transfer
How to approach this question
Avoid = Don't do it. Mitigate = Fix it. Transfer = Insure it. Accept = Live with it.
Full Answer
C.Risk Avoidance✓ Correct
Risk Avoidance involves eliminating the risk by discontinuing the activity that generates it.
Common mistakes
Confusing Avoidance (stopping) with Mitigation (reducing).
Practice the full CPA ISC Practice Exam 4
82 questions · hints · full answers · grading
More questions from this exam
Q01A CPA is advising a client who is migrating their legacy on-premise ERP system to a cloud environ...HardQ02An auditor is reviewing the Service Level Agreement (SLA) for a client using a public cloud provi...HardQ03A company uses an Infrastructure as a Service (IaaS) model. During an IT audit, the auditor disco...HardQ04An organization is implementing the COSO Enterprise Risk Management (ERM) framework to govern its...HardQ05During a walkthrough of an order-to-cash process, the auditor observes that the sales manager can...Hard