Which of the following is MOST important when duties in a small organization cannot be appropriately segregated?
Which of the following is MOST important when duties in a small organization cannot be appropriately segregated?
When duties in a small organization cannot be appropriately segregated, independent reviews are the most important. Independent reviews serve as a compensating control to detect errors or irregularities, which is particularly crucial when segregation of duties is not feasible. These reviews help ensure accuracy and compliance by providing a layer of oversight that can catch mistakes or intentional deviations from procedures.
I think C
D is correct. In CRM under "Compensating Controls for Lack of Segregation of Duties", "Independent reviews are carried out to compensate for mistakes or intentional failures in following prescribed procedures. These reviews are particularly important when duties in a small organization cannot be appropriately segregated. Such reviews will help detect errors or irregularities."
While an audit trail is valuable for tracking activities and providing transparency, independent reviews add a critical element of scrutiny and validation. They can help detect errors, fraud, or inefficiencies that might otherwise go unnoticed due to the absence of segregation of duties.