Communicating Audit Findings: Encouraging Management Action

Encouraging Management Action

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Question

Communicating which of the following would BEST encourage management to initiate appropriate actions following the receipt of report findings?

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A. B. C. D.

D.

The BEST way to encourage management to initiate appropriate actions following the receipt of report findings is by communicating the risk implications of the observations. Here's why:

A. Risk implications of the observations: The risk implications of the observations highlight the potential impact on the organization if the issues identified in the report findings are not addressed. By communicating the potential risks associated with the findings, management is more likely to prioritize and take action to mitigate these risks.

B. Strict deadlines to close all observations: Strict deadlines may encourage management to take action, but it may also result in rushed or incomplete responses that do not fully address the underlying issues. Additionally, imposing unrealistic deadlines may cause management to prioritize meeting the deadline over addressing the root cause of the issue.

C. Statistical sampling used to derive observations: While statistical sampling is a useful tool in generating observations, communicating this information alone does not provide sufficient context for management to take appropriate actions.

D. Recommendations that align with the business strategy: Although recommendations that align with the business strategy are important, they may not be sufficient to encourage management to take action. Management may prioritize other strategic initiatives over addressing the report findings, especially if the recommendations are not seen as urgent or important.

In conclusion, communicating the risk implications of the observations provides the necessary context for management to understand the potential impact on the organization if the report findings are not addressed. This is likely to encourage management to initiate appropriate actions to mitigate the identified risks.