According to the COSO definition of safeguarding of assets:
A)controls over financial reporting are effective if they provide reasonable assurance that asset losses will not occur.
B)controls over financial reporting are effective if they provide reasonable assurance that losses are properly reflected in the financial statements.
C)controls over financial reporting are effective if they provide reasonable assurance that asset losses will not occur and that losses are properly reflected in the financial statements.
D)there is no way to create controls that will provide reasonable assurance that asset losses will not occur.

Question

Quizplus · Accepted Answer

According to the COSO framework, controls over financial reporting are considered effective if they provide reasonable assurance that losses, including those from asset misappropriation, are properly reflected in the financial statements. This does not mean preventing all losses but ensuring accurate financial reporting of any losses that do occur.

According to the COSO Definition of Safeguarding of Assets