1 - Assume you have evaluated an event and given it a score of 2 for probability and 3 for impact. Another event was given a score of 3 for probability and 2 for impact. What can be said about the two events given they both had scores of 5.

a) The event with the highest probability should be given the most concern

b) The event with the highest impact should be given the most concern

c) Judgment of the auditor determines which event should be given the most concern

d) Can not be determined with the information given

2 - Which statement is false?

a) Risk assessment involves both qualitative and quantitative elements

b) ERM is the responsibility of management

c) The ERM system is used by external auditors to make client acceptance decisions.

d) All of the above are true statements

3 - Which of the following generally reviews and documents ERM?

		Management
		Internal auditors
		Board of directors
		External auditors

4 - Which of the following represents the greatest risk?

		The loss of a substantial customer
		Excessive turnover of management
		No audit committee
		Poor cash flow