Which of the Following Statements Is Correct Regarding Internal Control

question 60

Multiple Choice

Which of the following statements is correct regarding internal control?

• A)A well-designed internal control environment ensures the achievement of an entity's control objectives.
• B)An inherent limitation to internal control is the fact that controls can be circumvented by management override.
• C)A well-designed and operated internal control environment should detect collusion perpetrated by two people.
• D)Internal control is a necessary business function and should be designed and operated to detect all errors and fraud.

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Definitions:

Illustrative Example

An example used to illustrate or explain a concept, idea, or principle more clearly.

Process

A series of actions or steps taken to achieve a particular outcome or to transform inputs into outputs.

Racial Group

A category of people identified by shared physical or social qualities into groups considered by society to be socially significant, often based on characteristics like skin color or ancestry.

Ethnic Group

A collection of people who identify with each other and share a common culture.