Which of the following statements concerning internal controls is true?

Question

Quizplus · Accepted Answer

A strong internal control system is designed to provide reasonable assurance that the objectives of a company will be accomplished. Option A is incorrect because internal administrative controls are concerned with ensuring that a company's operations are efficient and effective, not with limiting funds spent on investments. Option B is incorrect as separation of duties is designed to prevent fraud and errors, not to prohibit the employment of closely related parties. Option C is incorrect as internal accounting controls are concerned with the accuracy and completeness of financial reporting, not just protecting against embezzlement.

Which of the Following Statements Concerning Internal Controls Is True