Internal control policies and procedures have limitations including:
A)Human error.
B)Human fraud.
C)Cost-benefit principle.
D)Collusion.
E)All of the options are limitations.

Question

Quizplus · Accepted Answer

All of the options listed are limitations of internal control policies and procedures. Human error can occur due to mistakes, lack of attention, or misunderstanding of procedures. Human fraud can occur when employees intentionally manipulate or falsify information for personal gain. The cost-benefit principle can limit the effectiveness of controls if the cost is greater than the potential benefits. Collusion among employees can also undermine the effectiveness of controls, as multiple individuals working together can bypass or overcome controls designed to prevent misconduct.

Internal Control Policies and Procedures Have Limitations Including