Bumble Beasley Was Making a Presentation on Internal Control to a Group

question 8

Multiple Choice

Bumble Beasley was making a presentation on internal control to a group of prospective clients.Which of the following statements is the least appropriate for Bumble to make?

• A)Responsibility for internal control should be shared throughout the organization.
• B)All companies must use the COSO definition of internal control as a guide.
• C)Internal controls are not designed specifically to prevent fraud.
• D)Part of internal control is ensuring that a company is making the best possible use of its resources.

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Definitions:

Sole Proprietorship

A business structure where a single individual owns, operates, and is personally responsible for all aspects of the business.

Legal Structure

The legal organization of a company, determining its legal personality, liability, and taxation methods. Examples include sole proprietorship, partnership, corporation, and LLC.

C Corporation

A business structure where the company is taxed separately from its owners, offering limited liability protection to its shareholders.

Legally Liable

The state of being legally responsible for something, typically involving a financial or other obligation.