CFE – Fraud Prevention and Deterrence — Question 68

Hart, Inc. hired Kathleen, a risk management expert, to design a risk management program for the organization. Kathleen should focus on balancing which of the following two factors when creating the program?

Answer options

• A. The organization's internal controls and its financial reporting model
• B. Management's risk appetite and relevant regulatory requirements
• C. Management's risk appetite and the organization's ability to meet its objectives
• D. The organization's objectives and available resources

Correct answer: C

Explanation

The correct answer is C because a risk management program must align management's willingness to take risks with the organization's capacity to achieve its goals. Options A and B address specific aspects of risk but do not balance the overarching goals with risk appetite, while option D focuses on objectives and resources without considering risk appetite.