Which of the following statement is correct regarding internal control?
A)A well-designed internal control environment ensures the achievement of an entity's control objectives.
B)An inherent limitation to internal control is the fact that controls can be circumvented by management override.
C)A well-designed and operated internal control environment should detect collusion perpetrated by two people.
D)Internal control in a necessary business function and should be designed and operated to detect errors and fraud.

Question

Quizplus · Accepted Answer

Internal controls are designed to mitigate risks to an organization's objectives, but they have inherent limitations, including the possibility of management override, which can circumvent the controls.

Which of the Following Statement Is Correct Regarding Internal Control