A good system of internal control:
A)Urges adherence to prescribed managerial policies
B)Insures profitable operations
C)Eliminates the need for an audit
D)Requires the use of non-computerized systems
E)Is not necessary if the company uses a computerized system

Question

Quizplus · Accepted Answer

A good system of internal control is designed to ensure that the prescribed managerial policies are followed, thus promoting compliance and consistency in operations. While it can also help to promote profitability, this is not its primary purpose. It does not eliminate the need for an audit, which serves a distinct purpose in providing independent assurance of the effectiveness of the internal control system. The use of computerized systems is not in itself a determinant of the effectiveness of the internal control system.

A Good System of Internal Control