Joe is a 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) internal independent check of performance is violated.
C) segregation of duties is violated.
D) establishment of responsibility is violated.

Question

Quizplus · Accepted Answer

Segregation of duties is violated because Joe is both maintaining the accounting records and has custody of the inventory, which means the same person is responsible for the record-keeping and the physical handling of the inventory. This situation increases the risk of errors or fraud without easy detection.

Joe Is a Warehouse Custodian and Also Maintains the Accounting