Jared is warehouse custodian and also maintains the accounting record of the inventory held at the warehouse. An assessment of this situation indicates
A) documentation procedures are violated.
B) independent internal verification is violated.
C) segregation of duties is violated.
D) establishment of responsibility is violated.

Question

Quizplus · Accepted Answer

Segregation of duties is violated as Jared is responsible for both the custodial and accounting aspects of the inventory, which creates an opportunity for fraud or errors to go undetected. It is best practice to have different individuals responsible for the custody and recording of inventory.

Jared Is Warehouse Custodian and Also Maintains the Accounting Record