Out of 6 principles of internal control activities (i establishment of responsibility, ii. Segregation of duties, i. Documentation procedures, iv. Physical controls, v. independent internal verification, vi. Human resource controls), identify which control activity is violated in each of the following situations. 1. The person with primary responsibility for reconciling the bank account and making all bank deposits is also the company's accountant. 2. Company's treasurer received an award for distinguished service because he had not taken a vacation in 30 years. 3. In order to save money spent on order slips and to reduce time spent keeping track of order slips, a
Out of 6 principles of internal control activities (i establishment of responsibility, ii. Segregation of duties, i. Documentation procedures, iv. Physical controls, v. independent internal verification, vi. Human resource controls), identify which control activity is violated in each of the following situations. 1. The person with primary responsibility for reconciling the bank account and making all bank deposits is also the company's accountant. 2. Company's treasurer received an award for distinguished service because he had not taken a vacation in 30 years. 3. In order to save money spent on order slips and to reduce time spent keeping track of order slips, a
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Out of 6 principles of internal control activities (i. establishment of responsibility, ii. Segregation of duties, i.
Documentation procedures, iv. Physical controls, v. independent internal verification, vi. Human resource
controls), identify which control activity is violated in each of the following situations.
1. The person with primary responsibility for reconciling the bank account and making all bank
deposits is also the company's accountant.
2. Company's treasurer received an award for distinguished service because he had not taken a
vacation in 30 years.
3. In order to save money spent on order slips and to reduce time spent keeping track of order slips, a
local bar/restaurant does not buy prenumbered order slips.
4. Computer facilities do not equip with pass key access or fingerprint
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