B1: Corporate Governance and Operations Management Flashcards Preview

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Flashcards in B1: Corporate Governance and Operations Management Deck (29):
1

Network Marketing

Relationships and Referrals

2

E-Marketing

Use of Internet

3

Database Marketing

Target Groups

4

Interaction-Based Relationship Marketing

Repeat Business/Loyalty Discounts

5

Transaction Marketing

Lowest Price, Single Sale

6

Cause-and-Effect Diagram "Fishbone"

Trace "Defect" back to source using
1. Materials
2. Manpower
3. Machinery
4. Method

7

Pareto Diagram "Histogram"

Most to Least Frequent. Uses output/total for cumulative percentages

8

Control Charts

Determine "zero" defects. Also known as goalpost performance to ensure deviations are within an acceptable range

9

Partial Productivity Ratios

Output / Specific Quantity

10

Total Factor Productivity Ratios

Output / Total Costs

11

3 Objectives of COSO Framework "ORC"

1. Operations Objectives: Effectiveness & Efficiency
2.Reporting Objectives: External & Internal, Reliable and Transparent
3. Compliance Objectives: Adhere to laws & regulations

12

Components of Internal Control "CRIME"

1. Control Environment: Tone at the Top
2. Risk Assessment: Financial Statement misstatement or fraud?
3. Information & Communication: Fair, Accurate, Complete, & Timely = FACT
4. Monitoring: Efficiency of Internal Control, Report Deficiencies
5. Existing Control Activities: Policies/Procedures to mitigate risks

13

Control Environment "EBOCA"

Ethics & Integrity
Board Independence and Oversight
Organizational Structure
Commitment to Competence = Hire, Develop, Retain
Accountability

14

Risk Assessment "EAR"

Event Identification
Assess Risk
Respond to Risk

15

Information & Communication "FACT"

Internal: Internal Audit, Audit Committee, Management
External: CPA Firm
Fair
Accurate
Complete
Timely

16

Monitoring

Report and Correct Deficiencies

17

Existing Control Activies

Develop IT and Deploy Policies

18

Effective Internal Control Requirements

1. Present: Included as Designed
2. Functioning: Operating as Designed

19

Ineffective Internal Control

Major Deficiency

20

Enterprise Risk Management Objectives "SORC"

1. Strategic: High-level goals designed to achieve the mission
2. Operations: Efficient & Effective Use of Resources
3. Reporting: Consistent Reporting
4. Compliance: With Laws and Regulations

21

Components of Enterprise Risk Management "IS EAR AIM"

Internal Environment = (C)RIME
Setting Objectives = "SORC"

Event Identification \
Assessment of Risk | -> C(R)IME
Risk Response /

(Existing Control) Activities = CRIM(E)
Information & Communication = CR(I)ME
Monitoring = CRI(M)E

22

Internal Environment = Tone at the Top "EBOCA HR"

Ethics
Board Oversight
Organizational Structure
Commitment to Competence
Accountability

Human Resources & Risk Appetite
Risk Management

23

Setting Objectives "SORC"

Strategic Objectives
Operations
Reporting
Compliance

24

Event Identification

Risks (negative) and Opportunities (positive)
External = PESTN
Political
Economic
Social
Technological
Natural Environment

Internal = TIPP
Technology
Infrastructure
Personnel
Process

25

Assessment of Risk

Inherent = What's the risk is Management takes NO action
Residual = What's the risk AFTER Management takes action

26

Risk Response

Must align with the organizations overall risk appetite
Avoidance = Discontinue
Reduction = Invest
Sharing = Buy Insurance
Acceptance = No action

27

Existing Control Activities

Policies and Procedures
Variance Analysis = Budget vs. Actual
Activity Management = Performance Reports
Performance Indicators = Ratio Analysis = Red Flags

28

Information and Communication "FACT"

Fair
Accurate
Complete
Timely
Internal = Personnel External = Supplier and Customer

29

Monitoring

Verify Effective Operations
Separate Evaluations
Report Deficiencies