Which of the following is the GREATEST benefit of a three lines of defense structure?
A.
An effective risk culture that empowers employees to report risk
B.
Effective segregation of duties to prevent internal fraud
C.
Clear accountability for risk management processes
D.
Improved effectiveness and efficiency of business operations
The Answer Is:
C
This question includes an explanation.
Explanation:
A three lines of defense structure is a model that defines the roles and responsibilities of different functions and levels within an organization for risk management and control. The first line of defense is the operational management, which is responsible for owning and managing the risks. The second line of defense is the risk management and compliance functions, which are responsible for overseeing and supporting the risk management processes. The third line of defense is the internal audit function, which is responsible for providing independent assurance on the effectiveness of the risk management and control systems. The greatest benefit of a three lines of defense structure is that it provides clear accountability for risk management processes, as it clarifies who is responsible for what, and how they interact and communicate with each other. This can help to avoid duplication, confusion, or gaps in the risk management activities, and ensure that the risks are properly identified, assessed, treated, monitored, and reported. References = CRISC Review Manual, 7th Edition, page 107.
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