Which internal control procedure addresses the idea that the likelihood of employee fraud or theft is reduced if collusion is required to accomplish it?

The options for answering this question are the following:

A) Physical controls

B) Separation of duties

C) Use of prenumbered documents

D) Fidelity bonding

The correct answer is B) Separation of duties.

Explanation:

Separation of duties is a key concept of internal controls. Greater protection against fraud and errors must be balanced with the increasing cost and effort required.

Separation of duty, as a security principle, has as its primary objective the prevention of fraud and errors. This objective is achieved by disseminating the tasks and privileges associated with a specific business process among multiple users. This principle is demonstrated in the traditional example of separation of duty in the requirement of two signatures on a check.