Which of the following statements is correct?
A) Preventing errors during processing should not be an important objective of every accounting system.
B) Preventive controls can be applied to each transaction during normal processing to avoid errors occurring.
C) To be effective, controls over transactions should only include detective controls.
D) The purpose of preventive controls is to discover fraud or errors that may have occurred during transaction processing.

Question

Quizplus · Accepted Answer

Preventing errors during processing should be an important objective of every accounting system, and preventive controls can be applied to each transaction during normal processing to avoid errors from occurring. Detective controls are important as well, but preventive controls aim to stop errors before they happen. The purpose of preventive controls is not to discover fraud or errors that may have occurred during transaction processing, but rather to prevent them from happening in the first place.

Which of the Following Statements Is Correct