AGA GFMC Question Answer
Under the control environment component of internal control, management should
demonstrate a commitment to integrity and ethical values.
implement control activities through policies.
communicate quality information to achieve the entity's objectives.
establish and operate activities to monitor the internal control system.
Control Environment Component:
The control environment is the foundation of an internal control system, setting the tone at the top.
Demonstrating integrity and ethical values is the first principle of the control environment, as outlined in theCOSO Internal Control Framework.
Explanation of Answer Choices:
A. Demonstrate a commitment to integrity and ethical values: Correct. This is a foundational principle of the control environment.
B. Implement control activities through policies: This relates to the "Control Activities" component, not the control environment.
C. Communicate quality information to achieve the entity's objectives: This relates to the "Information and Communication" component.
D. Establish and operate activities to monitor the internal control system: This relates to the "Monitoring Activities" component.
TESTED 07 Sep 2025
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