What Is the Single Most Effective Control That Avoids Allowing

question 78

Multiple Choice

What is the single most effective control that avoids allowing one person to be in a position to perpetrate and then conceal errors or inappropriate activities?

• A) The segregation of authorization of transactions, custody of related assets, and modification or creation of related data and program files (or paper- based records).
• B) The requirement that each employee take a vacation each year.
• C) The establishment of an internal auditing department.
• D) The bonding of personnel in positions that necessitate handling cash and negotiable securities.

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Definitions:

Auto Sales & Finance

The business operations related to selling automobiles to consumers, usually involving financing options to assist with the purchase.

Co-Surety

A joint surety; one who assumes liability jointly with another surety for the payment of an obligation.

Debtor

An individual or organization that owes money or debt to another entity.

Default

A failure to fulfill a legal obligation, especially to repay a loan or appear in a court of law.