Which of the following is NOT a principle of internal control?
A) Responsibilities should be clearly established
B) Adequate records should be maintained
C) Responsibility for related transactions should be divided
D) Assets should be insured and employees bonded
E) Audits should always be conducted by employees internal to the organization

Question

Quizplus · Accepted Answer

While audits are an important part of internal control, it is not a principle of internal control that they must always be conducted by employees internal to the organization. In fact, it is often beneficial to have external auditors come in and provide an objective perspective. The other four choices are all principles of internal control: responsibilities should be clearly established to avoid confusion and ensure accountability, adequate records should be maintained to ensure accurate and timely information, responsibility for related transactions should be divided to prevent fraud or errors, and assets should be insured and employees bonded to protect against losses.

Which of the Following Is NOT a Principle of Internal