Question

Which of the following actions should not be taken initially when credible evidence exists that the corporation is unnecessarily exposing itself to risk?

1) The CAE may discuss his or her concerns about the risk exposure with senior management within his or her normal chain of command
2) The CAE may discuss his or her concerns with someone outside the organization
3) The chief audit executive may discuss his or her concerns about the risk of exposure with the board of directors
4) The chief audit executive may discuss his or her concerns with the parties responsible for the risk exposure

Answer 1

When credible evidence exists that a corporation is unnecessarily exposing itself to risk, the chief audit executive should not initially discuss concerns with the parties responsible for the risk exposure. Option 4.

Step-by-step explanation:

When credible evidence exists that the corporation is unnecessarily exposing itself to risk, the action that should not be taken initially is option 4) The chief audit executive may discuss his or her concerns with the parties responsible for the risk exposure. This is because discussing concerns with the parties responsible for the risk exposure may lead to bias and lack of objectivity in addressing the issue. It is important to maintain independence and seek appropriate channels for addressing the concerns, such as discussing with senior management, the board of directors, or someone outside the organization.