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Question 81

Which of the following statements regarding organizational governance is not correct?

An effective internal audit function is one of the four cornerstones of good governance.

Those performing governance activities are accountable to the customer.

Accountability is one of the key elements of organizational governance.

Governance principles and the need for an internal audit function are applicable to governmental and not-for-profit activities.

Correct Answer: B

Organizational governance entails ensuring accountability within the organization. This accountability is primarily to stakeholders such as shareholders, board members, or regulatory bodies rather than customers. Therefore, the statement that 'Those performing governance activities are accountable to the customer' is not correct.

Discussion

mkanchwalaOption: D

Both b and d seem to be correct answers. Can someone explain why D is not incorrect? In my view, governance principles are also applicable to profitable organizations and not only governmental and non-profit ones. Thanks in advance.

UmardOption: D

Option D is correct because the statement alone (without any condition) is correct.

Magic_FabOption: B

the statement of D is correct; so since the question is which one is not correct, the reply to choose is B