Certified Internal Auditor (CIA) Part 3: Business Knowledge for Internal Auditing — Question 210

A financial technology startup consists of self-managed teams. Although each team can make proposals to other teams, decision-making lies within each individual team. Which of the following risks could arise from this organizational structure?

Answer options

• A. Processes are bureaucratic.
• B. Decision-making is slow.
• C. Resources are duplicated.
• D. Power is overconcentrated.

Correct answer: C

Explanation

The correct answer is C because independent teams may end up utilizing the same resources for similar tasks, leading to duplication. Options A and B do not apply as self-managed teams typically have streamlined processes and quicker decision-making. Option D is incorrect because power is distributed among teams rather than being centralized.