Topic: COSO Internal Control FrameworkWhich of the Following Is the Best

question 21

Short Answer

Topic: COSO Internal Control FrameworkWhich of the following is the best way to compensate for the lack of adequate segregation of duties in a small organization?
A. Disclosing lack of segregation of duties to external auditors during the annual review.
B. Replacing personnel every three or four years.
C. Requiring accountants to pass a yearly background check.
D. Providing greater management oversight of incompatible activities.

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Definitions:

Leverage

The use of borrowed funds to increase the potential return of an investment.

Return on Stockholders' Equity

A measure of financial performance calculated by dividing net income by average shareholders' equity, indicating how effectively equity is used to generate profit.

Price-Earnings Ratio

A ratio for valuing a company that measures its current share price relative to its per-share earnings.

Market Price

The existing rate at which a service or commodity can be acquired or disposed of.