Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

6. Internal Controls and Reporting Cash

Five Components of Internal Controls

Financial Accounting

6. Internal Controls and Reporting Cash

Five Components of Internal Controls

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Multiple Choice

Which of the following is an internal control procedure used to safeguard a company's assets?

Allowing unrestricted access to cash

Ignoring discrepancies in financial records

Segregation of duties

Recording transactions only at year-end

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Verified step by step guidance

Understand the concept of internal control: Internal controls are processes and procedures implemented by a company to safeguard its assets, ensure the accuracy of financial records, and promote operational efficiency.

Identify the key principle of segregation of duties: This internal control procedure involves dividing responsibilities among different individuals to reduce the risk of errors or fraud. For example, the person responsible for recording transactions should not be the same person handling cash.

Evaluate the options provided: Analyze each option to determine whether it aligns with the goal of safeguarding assets. For instance, allowing unrestricted access to cash increases risk, and ignoring discrepancies in financial records undermines accuracy.

Recognize the importance of segregation of duties: This procedure ensures that no single individual has control over all aspects of a financial transaction, thereby reducing the likelihood of fraud or errors.

Conclude that segregation of duties is the correct answer: It is a widely recognized internal control procedure that helps protect a company's assets and maintain the integrity of its financial records.