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Which of the following should be the focus of the effect section of the preliminary observations document?
Correct Answer: A
The focus of the effect section of the preliminary observations document should be on residual risk. Residual risk is the remaining risk after management has taken action to mitigate the inherent risk with controls and other risk responses. Documenting the effect in terms of residual risk helps in understanding the potential impact of the observed issues on the organization if not addressed. References: * IIA Standards: 2310 - Identifying Information * IIA Practice Guide: Communicating the Results of an Audit