When determining what duties need to be segregated:
A) it is not necessary to separate the accounting department from the operating departments.
B) it is not necessary to separate the receiving of cash from the recording of cash.
C) it is necessary to separate the owner from the cash receipts function.
D) it is necessary to separate the cash disbursements function form the bank reconciliation function.

Question

Quizplus · Accepted Answer

It is necessary to separate the cash disbursements function from the bank reconciliation function to ensure that there is an appropriate separation of duties and to prevent fraud or errors from occurring. Option A is incorrect as segregating the accounting department from the operating departments may not be necessary in all cases. Option B is incorrect as it is crucial to separate the receiving of cash from the recording of cash to prevent misappropriation of cash. Option C is also incorrect as there may not be a need to separate the owner from the cash receipts function in all cases.

When Determining What Duties Need to Be Segregated