A system of internal control
A) is infallible.
B) can be rendered ineffective by employee collusion.
C) invariably will have costs exceeding benefits.
D) is premised on the concept of absolute assurance.

Question

Quizplus · Accepted Answer

Employee collusion can undermine even the strongest system of internal control, as it involves individuals knowingly working together to circumvent or undermine the control measures. While a system of internal control can help reduce the risk of fraud, error and waste, it cannot provide absolute assurance, nor will the costs always outweigh the benefits.

A System of Internal Control