One example of internal controls is
A) leaving all financial decisions to the sole discretion of the CFO.
B) having budgets that aren't reconciled against the plan.
C) allowing a single individual to complete the payment cycle in a payment system.
D) relying solely on a computerized accounting system to make payments.
E) the separation of duties for authorizing and making payments.

Question

Quizplus · Accepted Answer

The separation of duties for authorizing and making payments is an example of internal controls as it helps prevent fraud and errors. It ensures that no single individual has complete control over the payment process, thus reducing the risk of unauthorized payments or payments made to fictitious vendors. The other options listed are not good examples of internal controls as they either allow for too much discretion or lack proper checks and balances.

One Example of Internal Controls Is