What is the most appropriate control to prevent improper use of share or bond instruments?
A)Authorization to purchase shares by a senior financial officer.
B)Use of a registered broker to purchase and sell all shares.
C)Proper custodial control of securities.
D)Registration of bond instruments with the exchange authorities.

Question

Quizplus · Accepted Answer

Proper custodial control of securities, including shares and bonds, is the most appropriate control to prevent their improper use. This involves keeping securities physically secure and using proper tracking and accounting procedures to prevent unauthorized transactions. While the other options can also be helpful controls, they may not be sufficient on their own to prevent misuse. Authorization by a senior financial officer can be circumvented by fraudulent activity, using a registered broker does not guarantee proper handling of securities, and registration with exchange authorities does not provide direct control over the security itself.

What Is the Most Appropriate Control to Prevent Improper Use