At Radiant,Inc. ,the sales department is also responsible for recording cash transactions as it does not have a separate accounting department.
In the above situation,which internal control procedure needs strengthening?

Question

Quizplus · Accepted Answer

The internal control procedure that requires strengthening in this situation is the separation of duties. As per this procedure, different tasks and responsibilities should be assigned to different individuals to reduce the risk of errors or fraud. In this case, the sales department should not be responsible for both sales and cash transactions recording as it creates an opportunity for mishandling or misappropriation of cash. A separate accounting department should be established to record all cash transactions, ensuring adequate checks and balances.