Internal control over financial reporting includes each of the following elements except for:
A) Maintaining accurate financial records
B) Providing reasonable assurance that receipts and expenditures are recorded based on proper authorization by management
C) External audit conducted in accordance with generally accepted auditing standards
D) Adhering to company policies and procedures

Question

Quizplus · Accepted Answer

The other three elements - maintaining accurate financial records, providing reasonable assurance of proper authorization, and adhering to company policies and procedures - are all key components of internal control over financial reporting. However, external auditing is not considered an element of internal control since it is conducted by an external party rather than by the organization itself. Instead, external auditing serves as a check on the effectiveness of an organization's internal controls.

Internal Control Over Financial Reporting Includes Each of the Following