A Material Control Weakness Is a Deficiency in Internal Control

question 58

True/False

A material control weakness is a deficiency in internal control such that a reasonable probability exists that a material misstatement of the company's financial statements may not be prevented or detected on a timely basis.

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Definitions:

Substantially Performed

A term indicating that the major and necessary tasks of a contract have been completed, even if minor details may have been omitted.

Commercial Impracticability

A legal defense that excuses the performance of a contract due to unforeseen and uncontrollable circumstances that make fulfillment excessively burdensome or impossible.

Financially Unsound Contract

A contract deemed as high-risk due to the financial instability or inability of one or more parties to fulfill their obligations.

Relieved from Performance

A legal condition where a party is released from fulfilling their obligations under a contract due to unforeseen circumstances.