Which of the following areas of responsibility would cause the GREATEST segregation of duties conflict if the individual who performs the related tasks also has approval authority?
Which of the following areas of responsibility would cause the GREATEST segregation of duties conflict if the individual who performs the related tasks also has approval authority?
Goods receipts and payments would cause the greatest segregation of duties conflict if the individual who performs the related tasks also has approval authority. This is because it involves both the physical handling of inventory and the financial control over payments, thereby posing a higher risk of fraud or misappropriation. Segregation of duties is essential to prevent abuses of authority, and combining these functions in a single role offers a significant opportunity for fraudulent activities, making it the most critical area of concern.
should be B
Invoices and reconciliations present a segregation of duties conflict if the same individual who performs the related tasks also has approval authority because they can manipulate the invoicing and reconciliation process for personal gain. The individual may approve fraudulent invoices, alter the amounts on invoices, or misstate the reconciliation to hide discrepancies. Segregation of duties is a fundamental principle of internal control that aims to minimize the risk of fraud and error by dividing critical financial and operational responsibilities among different individuals. By separating the tasks of reconciling invoices from the authority to approve them, it becomes more difficult for a single individual to commit fraud or make an error without detection.
D. Goods receipts and payments
While Option A represents a segregation of duties concern, Option D presents a greater conflict because it involves both the physical handling of inventory and the financial control over payments, thereby posing a higher risk of fraud or misappropriation. Therefore, Option D is considered to have the GREATEST segregation of duties conflict.
Three way match. D only
B, it s finance concerns. for SoD. fraund is more critical and must be fully concern
D. Goods receipts and payments
Answer: C the person authorizing purchase orders should not be the same individual who initiated the requisition.
While invoices and reconciliations (Option B) also involve important financial processes, separating these tasks does not inherently create the same level of conflict as goods receipts and payments. In the case of goods receipts and payments, the potential for misuse or abuse of authority is more pronounced due to the direct link between receiving goods and authorizing payments.