Which of the Following Is True of Internal Control

question 64

Multiple Choice

Which of the following is true of internal control?

• A)A company's outside auditor is responsible for the company's internal control system.
• B)One of the major purposes of internal control is to ensure that the assets are safeguarded.
• C)Internal control procedures tend to diminish the importance of operational efficiency.
• D)Internal controls are mainly used to ensure timely payment of liabilities.

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Definitions:

Debt Ratio

A financial ratio that measures the proportion of a company's total debt to its total assets, indicating the leverage level and financial health.

Mortgage-backed Securities

Investments secured by mortgages, which pay investors from the mortgage payments of homeowners.

Persistence

The tendency of a variable, phenomenon, or condition to continue its existing trend or state over a period.

Mutual Funds

Mutual Funds are investment vehicles that pool money from multiple investors to purchase diversified portfolios of stocks, bonds, or other securities.