CFE – Fraud Prevention and Deterrence — Question 61

Which of the following is NOT a factor that directors and management should consider when developing a corporate governance framework for an organization?

Answer options

• A. The organization's cultural environment
• B. The ability of the framework to remain static during changes in the corporate landscape
• C. The legal and regulatory environment in which the organization operates
• D. The organization's ethical environment

Correct answer: C

Explanation

The correct answer is C, as the legal and regulatory environment is a critical factor that must be considered when developing a corporate governance framework. In contrast, while the organization's cultural and ethical environments are important, the ability of the framework to remain static during changes is not a realistic expectation in a dynamic corporate landscape.