Segregation of Duties Is a Fundamental Concept in an Effective

question 89

Multiple Choice

Segregation of duties is a fundamental concept in an effective system of internal controls.Nevertheless, the effectiveness of this control can be compromised through which situation?

• A)A lack of employee training
• B)Collusion among employees
• C)Irregular employee reviews
• D)The absence of an internal audit function

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Definitions:

Bank Reconciliation

The process of matching and comparing figures from accounting records against those presented on a bank statement to ensure consistency and accuracy in financial records.

Voucher System

A control mechanism in accounting to ensure that every payment is properly authorized and recorded.

Liability

A company’s legal financial debts or obligations that arise during the course of business operations.

Cash Payment

A transaction where payment for goods or services is made immediately using cash or a cash equivalent, as opposed to credit.