Choice "B" is correct. Internal control information is needed to facilitate the function of control components and is identified, captured, used and distributed in a timely manner that enables personnel to fulfill their responsibilities. Reporting that triggers prompt exception resolution, root cause analysis, and control updates illustrates this principle.
Choice "c" is incorrect. Financial reporting information principles anticipate that information is identified, captured, used at all levels of the company and distributed in a manner that supports the achievement of financial reporting objectives. Variance analysis supports control more so than effective financial reporting.
Choice "a" is incorrect. Internal communications anticipate that communications enable and support understanding and execution of internal control objectives, processes, and individual responsibilities. Variance analysis specifically supports internal control, not simply internal communications generally.
Choice "d" is incorrect. External communications anticipate that matters affecting the achievement of financial reporting are communicated with outside parties.