he chairman of a medium-sized listed industrial company has called a board meeting to discuss risk and risk management within the company. He is concerned by a recent fall of about 40% in the companys share price, following poor interim financial results and adverse media reports claiming that the problems of the company were the result of poor risk management and exposure to excessive business and other risks. The chairman has also been angered by a number of incidents reported to him by the chief executive officer. (i) There has been a serious breach of health and safety regulations at a foreign subsidiary, resulting in a number of deaths and serious injuries to employees. (ii) An important new IT system was introduced by the company a few months ago, apparently without adequate testing of the back-up system in the event of system failure. (iii) Some large expenditure on capital assets were made without proper authorization and invoices are not available for some of the money spent. Two managers have been dismissed as a result.

a)Contrast business risk and internal control risk.? b)In your opinion, on whom does the responsibility of internal control lie? Substantiate your answer. C)Discuss the essential components of the internal control framework. d)Risk assessment needs to an active and ongoing process. Defend this statement. e)Examine the grounds on which internal control needs to be evaluated and assessed.