A Voucher System Is an Example of an Internal Control

question 89

True/False

A voucher system is an example of an internal control procedure over cash payments.

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Definitions:

Moral Hazard

A situation in economic theory where one party is willing to take more risks because the negative consequences of the risk will be borne by another party.

Moral Hazard

A situation where one party is more likely to take risks because another party bears the consequences of those risks.

Specific Purpose

A clearly defined and precise goal or objective that a project, action, or entity aims to achieve.

Market Signaling

Actions taken by buyers and sellers to communicate quality in a world of uncertainty.