Which of the following would represent proper segregation of duties?
A)The employee who has custody of cash also does accounts receivable record keeping.
B)The employee who has custody of cash completes the bank reconciliation.
C)The employee who opens mail containing checks prepares a list of checks received.
D)The employee who opens mail containing checks records transactions in the general ledger.

Question

Which of the following would represent proper segregation of duties?
A)The employee who has custody of cash also does accounts receivable record keeping. 
B)The employee who has custody of cash completes the bank reconciliation.
C)The employee who opens mail containing checks prepares a list of checks received.
D)The employee who opens mail containing checks records transactions in the general ledger.

Quizplus · Accepted Answer

Segregation of duties is a key internal control that helps to prevent fraud and errors. This principle dictates that no single employee should be responsible for both recording and controlling or custody of assets. Option C is correct because the employee who opens mail containing checks and prepares a list of checks received is not also recording transactions in the general ledger or having custody of cash, which separates the duties of handling assets and record-keeping.

Which of the Following Would Represent Proper Segregation of Duties