Management philosophy and operating style most likely would have a significant influence on an entity's control environment when:
A)internal audit personnel have direct access to the board of directors and the entity's management.
B)the entity does not have sound personnel policies for hiring, training, and evaluating competent individuals.
C)accurate management job descriptions delineate specific duties.
D)the audit committee actively oversees the financial reporting process.

Question

Quizplus · Accepted Answer

Management philosophy and operating style are integral to how an entity establishes its control environment, which includes how it hires, trains, and evaluates its personnel. If an entity lacks sound personnel policies, it indicates a management philosophy that does not prioritize establishing a strong foundation for internal control, directly impacting the control environment. Choices A, C, and D relate more to the structure and functioning of oversight and specific roles rather than the overarching management philosophy and operating style's influence on the control environment.

Management Philosophy and Operating Style Most Likely Would Have a Significant