GRCA Questions and Answers

Inspecting the use of a RACI template in the field to see how it is being used is classified as a substantive test. This test involves examining actual instances of the RACI template's application to verify its proper use in practice. It goes beyond evaluating the design of the control (the template itself) and looks at the real-world implementation and effectiveness, providing evidence on how the control operates in practice.

References:

AICPA Auditing Standards

ISO 19011:2018 - Guidelines for auditing management systems

The parameters of an assessment include Scope, Criteria, and Nature of Testing. These elements define the boundaries and focus of the assessment:

Scope:Defines the areas, processes, and activities to be assessed.

Criteria:Specifies the standards, policies, and regulations against which the assessment will be conducted.

Nature of Testing:Describes the types and extent of testing procedures that will be employed to gather evidence and evaluate compliance and performance.

These parameters ensure that the assessment is well-structured, targeted, and aligned with the objectives and requirements of the organization.References:

ISO 19011:2018 - Guidelines for auditing management systems

COSO Internal Control – Integrated Framework

GRC (Governance, Risk, and Compliance) integrates multiple disciplines to create a cohesive approach to managing an organization's overall governance, risk management, and compliance with regulations. The integrated disciplines include:

Audit and Assurance: Ensuring internal controls are effective and compliance with laws and policies.

Governance and Oversight: Establishing frameworks and policies to guide the organization.

Strategy and Performance Management: Aligning risk management and compliance with strategic objectives.

Quality and Conformance: Ensuring products/services meet regulatory and customer standards.

Information Privacy and Security: Protecting sensitive data and ensuring information security.

Compliance and Ethics: Adhering to legal requirements and promoting ethical behavior.

Risk and Decision Support: Identifying, assessing, and mitigating risks to support decision-making.

The integration of these disciplines ensures a comprehensive approach to managing risks and achieving organizational objectives.

References:

OCEG GRC Capability Model (Red Book)

ISO 31000:2018 - Risk management – Guidelines

COSO Enterprise Risk Management – Integrating with Strategy and Performance

If follow-up discovers that actions and controls haven't been implemented, it is important to use professional judgment and work with the action owner to understand why the plans have not been implemented. Immediate escalation to the board without understanding the context may not be the most effective approach. Engaging with the action owner can help identify obstacles and facilitate a constructive resolution. Escalation should be considered if there is a significant risk or if there is consistent non-compliance despite reasonable efforts to address the issue.References:

ISO 19011:2018 - Guidelines for auditing management systems

IIA Standards for the Professional Practice of Internal Auditing

Management is defined as "internally directing, controlling and evaluating an entity, process or resource." Management involves overseeing the day-to-day operations of an organization, making decisions, setting policies, and ensuring that the organization's resources are used effectively to achieve its goals. This function includes planning, organizing, leading, and controlling organizational activities to meet established objectives.References:

ISO 9001:2015 - Quality management systems – Requirements

COSO Internal Control – Integrated Framework

It is important to confirm observations and recommendations with personnel who conduct the work being assessed. Engaging with them ensures accuracy and relevance in the findings and recommendations, as they provide context and insights that the assurance team might not have. This collaboration helps to avoid misunderstandings and ensures that the recommendations are practical and feasible for implementation.References:

ISO 19011:2018 - Guidelines for auditing management systems

COSO Internal Control – Integrated Framework

During the planning phase of an assessment, it is not necessary to conduct a complete risk assessment and detailed testing. Instead, limited information gathering and initial procedures are sufficient to estimate inherent risk and control risk, allowing planning to proceed. This initial estimate helps to set the scope and focus of the assessment. Detailed testing and a comprehensive risk assessment can be conducted during the actual assessment phase. This approach allows for a more efficient and flexible planning process.References:

ISO 19011:2018 - Guidelines for auditing management systems

NIST SP 800-30 Rev. 1 - Guide for Conducting Risk Assessments

A NEGATIVE assurance opinion or statement indicates that, based on the procedures performed and evidence obtained, the assurance provider did not identify any reasons to believe that the subject matter does not conform to the applicable criteria. This form of opinion does not provide absolute assurance but rather limited assurance, suggesting that nothing came to the auditor's attention that causes them to believe the subject matter is not fairly stated.References:

AICPA Auditing Standards

IIA Standards for the Professional Practice of Internal Auditing