A fundamental principle of ______ requires that no one person handles an entire financial transaction.
A) endowments
B) internal control
C) external control
D) data integrity policies

Question

Quizplus · Accepted Answer

This principle is a key element of internal control, which is designed to safeguard assets, ensure reliable financial reporting, and promote compliance with laws and regulations. Segregation of duties is an effective way to prevent fraud and errors, as it involves dividing responsibilities among different individuals to create a system of checks and balances. This means that the person who authorizes a transaction should not be the same person who records it, and the person who handles cash should not be the same person who reconciles bank statements. By separating these functions, an organization can reduce the risk of mistakes or intentional misappropriation of funds.

A Fundamental Principle of ______ Requires That No One Person