Risk management
Risk management is the process of identifying, assessing and responding to risks that could affect an organisation’s objectives, and monitoring the effectiveness of those responses. The auditor considers management’s process where relevant to the financial-statement audit, while retaining an independent risk assessment.
Worked example
Management identifies cyber risk affecting sales records and introduces access controls and monitoring.
Common mistake
Management’s risk register does not replace the auditor’s assessment of risks of material misstatement.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | AA | Supporting | September 2026–June 2027 |
| ACCA | SBL | Direct | September 2026–June 2027 |