Which items are examples of internal control techniques?

Which items are examples of internal control techniques?

• A. Segregation of duties; Physical controls (security guards); Authorisation and approval; Supervision
• B. Data encryption; Password policies; Firewall; VPN
• C. Scenario planning; Fraud prevention; Scenario analysis; Risk registers
• D. Budgeting; Forecasting; Cash flow management; Tax planning

Answer: (C)

Internal control techniques are the methods and processes a business uses to identify, assess, and mitigate risks and to prevent or detect errors and fraud within operations. The best choice includes items that are about planning, monitoring, and documenting risk and applying proactive prevention measures. Scenario planning helps anticipate plausible future events and design controls to handle them, so controls aren’t just reactive but built into how the organization thinks about risks. Fraud prevention is a direct aim of internal controls, shaping policies and activities that reduce opportunities for dishonest behavior. Scenario analysis examines how controls perform under different situations, revealing gaps and informing stronger controls. A risk register formalizes identified risks, assigns owners, and tracks indicators and control effectiveness, providing a governance tool that guides ongoing control improvement. Together, these elements represent the systematic, risk-management oriented side of internal controls, beyond just physical barriers, approvals, or duties separation.

Internal control techniques are the methods and processes a business uses to identify, assess, and mitigate risks and to prevent or detect errors and fraud within operations. The best choice includes items that are about planning, monitoring, and documenting risk and applying proactive prevention measures. Scenario planning helps anticipate plausible future events and design controls to handle them, so controls aren’t just reactive but built into how the organization thinks about risks. Fraud prevention is a direct aim of internal controls, shaping policies and activities that reduce opportunities for dishonest behavior. Scenario analysis examines how controls perform under different situations, revealing gaps and informing stronger controls. A risk register formalizes identified risks, assigns owners, and tracks indicators and control effectiveness, providing a governance tool that guides ongoing control improvement. Together, these elements represent the systematic, risk-management oriented side of internal controls, beyond just physical barriers, approvals, or duties separation.