The auditing standards describe an organization’s internal controls as consisting of five elements.

Required:

a. Briefly describe the relationship among the five components of an organization’s internal controls.

b. Briefly explain how a deficiency in any one of the components of an organization’s internal controls affects the overall assessment of control risk. In your analysis, assume a deficiency within one of the specific components and no serious deficiencies in the other components.

c. Is a control risk assessment made for the overall organization or for specific subsystems of the organization’s transaction processing systems? Explain.