Which of the Following Is True of Internal Control

question 159

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 only necessary for public companies.

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Definitions:

Trust

A fiduciary relationship in which one party, known as a trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary.

Oligopolist

A firm or entity that operates in a market structure characterized by a small number of firms dominating the market, leading to limited competition.

Proctor & Gamble

A multinational corporation specializing in consumer goods ranging from personal care to cleaning products.

Family Farm

A farm owned and operated by a family, typically involving residential family members in its operations.