Who should receive periodic reports regarding risk management and control effectiveness?

Periodic reports regarding risk management and control effectiveness are critical for informed decision-making within an organization. The board of directors and management are key recipients of this information because they hold the ultimate responsibility for the organization's governance and strategic direction.

The board needs to be aware of significant risks and the effectiveness of controls in place to mitigate those risks in order to fulfill their oversight duties effectively. Likewise, management requires this information to make operational decisions and ensure that the organization complies with relevant laws and regulations while pursuing its objectives.

Receiving these reports empowers both the board and management to evaluate organizational health, assess risk exposure, and deploy resources more effectively. They can also foster a culture of accountability and clarity around risk management processes in the organization. Stakeholders typically include a broader group, such as investors or customers, but may not need the same level of detail or frequency of reports. External auditors focus on financial reporting and compliance rather than day-to-day risk management operations. Although employees play a role in risk management, they are not typically the primary audience for high-level periodical reports of this nature.