GOVERMIC : 3 LINES OF DEFENSE MODEL

What are the three distinct layers of the Three Lines of Defense model?

• Operational management

• Compliance oversight

• Internal audit assurance layers

How does the model strengthen internal controls and accountability?

Defines clear roles & responsibilities across all.

In what way does the model support corporate governance?

• Promoting transparency

• Trust

• Adherence to international standards like IIA

What are the improved risk management outcomes of using this model?

• Better decision-making

• Reduced risks

• Resilience against fraud and failures

What is the role of operational management in the first line of defense?

• Owning and managing risks in daily activities

• Ensuring policy compliance

How does the first line handle risk identification and mitigation?

• Managers identify potential workflow risks

• They take proactive steps to reduce them

How are training and accountability managed in the first line?

• Tools and training supported by

• Metrics and accountability systems

How is a risk-aware culture built within the first line?

• Embedding risk awareness in daily operations to

• Foster responsibility and integrity

What is the oversight and guidance role of the second line?

• Developing risk policies

• Monitoring systems to guide operational teams

Who are the key roles found within the second line of defense?

• Compliance officers

• Legal advisors

• Risk managers who assess regulatory adherence

Why must the second line maintain independent and objective control?

• To provide unbiased oversight

• Uphold ethical standards separate from operations

What are the benefits of a robust second line of defense?

• Reduced regulatory penalties

• Increased stakeholder confidence

• Through effective mitigation

What is the independent assurance role of the third line?

Providing independent assurance on

governance,

risk management,

and internal control

effectiveness.

How does internal audit conduct systematic risk-based audits?

• By performing audits

• Identify control weaknesses

• Compliance gaps

What is the third line's role in fraud detection and prevention?

• Detecting fraud

• Preventing financial misstatements

• Protect organizational reputation

How does internal audit enhance transparency and accountability?

By providing unbiased insights.

How does the model ensure clear roles and accountability?

Defines functions

across operational, oversight, and assurance levels

To reduce ambiguity

What is the purpose of enhanced risk controls in the model?

• Minimizing conflicts of interest

• Strengthening the reliability of risk controls

How does the model lead to improved decision-making?

Providing management with

accurate, timely information

From compliance teams and auditors

How does the model contribute to organizational resilience?

Creating multiple protection layers

Against fraud, cyber threats, and operational failures

What cultural shift is required for implementing this model?

Culture of accountability and risk awareness.

Why is leadership and training commitment vital for the model?

Ensures understanding of risk management roles

And ethical compliance requirements

How does technology-enabled risk monitoring support the defense lines?

• Supports real-time monitoring and data analytics

• To enhance defense effectiveness

Why is collaboration among defense lines necessary?

• Creating a robust defense against threats

• Through cooperation between independent lines