Which of the following statements is most correct with respect to separation of duties?
A)A person who has temporary or permanent custody of an asset should account for that asset.
B)Employees who authorize transactions should not have custody of related assets.
C)Employees who open cash receipts should record the amounts in the subsidiary ledgers.
D)Employees who authorize transactions should have recording responsibility for these transactions.

Question

Quizplus · Accepted Answer

Separation of duties is the concept of dividing a process into different tasks to prevent one person from having complete control over it. Ideally, no one person should have access to all aspects of a process. In option B, employees who authorize transactions should not have custody of related assets, which is an example of separation of duties. By having different employees handling these two aspects of the process, it reduces the risk of fraud or errors. Option A, C, and D do not correctly reflect the principle of separation of duties.

Which of the Following Statements Is Most Correct with Respect