For Each of the Following Situations, Indicate Which Internal Control

question 155

Essay

For each of the following situations, indicate which internal control procedure ABC company has violated:
_____ 1. Since they are costly, background checks are not done for the employees.
_____ 2. Purchases of items on credit do not need the approval of the purchasing department.
_____ 3. All hard copies of documents are shredded after one month and electronic records are deleted after two months.
_____ 4. The company does not prepare operating or cash budgets.
_____ 5. The accountant receives the cash and records the cash receipts.
_____ 6. There are no locks in the area where inventory is stored.
_____ 7. The hiring, firing and pay adjustments and made by the department foremen.

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Definitions:

High-traffic Areas

Locations or spaces that receive a large number of visitors or passersby, often requiring special consideration in design and maintenance.

Looking-glass Self

A concept in sociology that suggests an individual's self-concept is influenced by how they believe others perceive them.

Ideal

A conception or standard of perfection, serving as a model or criterion for comparison, often unattainable or abstract.

Actual

Actual refers to something existing in reality or fact, not merely potential or hypothetical, but truly present or occurring.