Proper separation of duties reduces the opportunities to allow persons to be in positions to both:
A)journalize entries and prepare financial statements.
B)record cash receipts and cash disbursements.
C)establish internal controls and authorize transactions.
D)perpetrate a fraud and then conceal it in the books.

Question

Quizplus · Accepted Answer

Proper separation of duties is a key internal control that helps prevent fraud by ensuring no single individual has control over all aspects of a financial transaction. This makes it harder for someone to commit and then conceal fraudulent activities, as it would require collusion between multiple parties. Options A, B, and C describe functions that can be separated to enhance controls, but they do not directly address the dual aspects of committing and concealing fraud as effectively as option D does.

Proper Separation of Duties Reduces the Opportunities to Allow Persons