When an organization integrates governance, risk, and compliance (GRC) activities into a centralized technology-based resource, enterprise governance must ensure that the system:
* Supports strategic decision-making by the board and senior management.
* Provides accurate, reliable, and quality information to demonstrate an effective governance framework.
* Aligns with IIA Standard 2110 - Governance, which requires auditors to assess whether the organization's governance structure supports accountability, transparency, and effective decision- making.
* (A) The board should be fully satisfied that there is an effective system of governance in place through accurate, quality information provided. (Correct Answer)
* Governance is about ensuring that stakeholders, particularly the board, have confidence in the organization's control environment and decision-making process.
* IIA Standard 2110 (Governance) states that internal auditors must evaluate the adequacy and effectiveness of governance structures.
* A GRC system should ensure transparency, accountability, and quality reporting to enable strategic governance oversight.
* (B) Compliance, audit, and risk management can find and seek efficiencies between their functions through integrated information reporting.
* While improving efficiency is a benefit of a GRC system, it is a secondary objective, not a primary enterprise governance concern.
* (C) Key compliance and risk metrics can be tracked and compared throughout the enterprise, aiding in identifying problem departments.
* Tracking risk metrics is useful but does not directly address governance at the board level, making this answer incomplete.
* (D) Data analytics can be utilized for trending of the data to ensure that patterns and ongoing monitoring occurs throughout the organization.
* Analytics support monitoring, but the core governance concern is ensuring the board's confidence in the system.
* IIA Standard 2110 - Governance: Internal auditors must assess whether governance processes are effective.
* GTAG 1 - Information Technology Risks and Controls: IT governance must provide quality, reliable information for decision-making.
* COSO ERM Framework: Emphasizes governance as a key driver of enterprise risk management.
Analysis of Each Option:IIA References Supporting the Answer:Thus, the correct answer is (A) because effective enterprise governance relies on accurate and high-quality information for strategic decision- making.