Ask Question
10 July, 06:51

Internal control does not consist of policies and procedures that

a. protect assets from misuse

b. ensure employees and managers comply with laws and regulations

c. ensure that business information is accurate

d. guarantee the company will earn a profit

+5
Answers (1)
  1. 10 July, 07:08
    0
    d. guarantee the company will earn a profit

    Explanation:

    Internal controls are controls put in place by management to mitigate against identified risk. Risk basically refers to what could go wring in a process. Controls are put in place to mitigate against the risk of error or fraud and do not necessarily prevent the company from making a loss.

    Companies make profit or loss based on management's decisions such as where to invest, what time to invest, introduction of a new product, management of cost of sales and operating expenses etc

    Internal controls basically consist of policies and procedures that ensure that the company's asset are not misused (fraud), no misrepresentation of revenue (fraud), employees and managers comply with laws and regulations, business information is accurate (no misrepresentation of records due to error) etc.

    Hence Internal control does not consist of policies and procedures that guarantee the company will earn a profit.

    The right option is d.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Internal control does not consist of policies and procedures that a. protect assets from misuse b. ensure employees and managers comply ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers