Day: December 21, 2025

ISA (UK) 315 states that an internal control system in an organisation consists of five components:

• the control environment
• the entity’s risk assessment process
• the information system
• the control activities
• the monitoring of controls

For each of the following examples, select the component which it illustrates:

-Review by management of monthly bank reconciliations

Select ONE answer:

1. the monitoring of controls
2. the control activities
3. the entity’s risk assessment process
4. the control environment

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct =>   Monitoring of controls involves reviewing the effectiveness of controls and whether they need improvement; thus, management’s review of monthly bank reconciliations is part of that monitoring system.
2. Not correct
3. Not correct
4. Not correct

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