Question

Chec Required: Identify each of the following internal controls as primarily a preventive, detective, or corrective control. Type of Control Internal Controls a. Limit access to petty cash funds. Reconcile the petty cash fund before replenishing it Require two signatures on checks above a specified limit, Enable hidden flags or audit trails on accounting software. Examine credit card statements and corresponding receipts each month, independently, to determine whether charges are appropriate. Keep checks in a locked box or drawer and restrict the number of employees who have access to the key. 9. Back up accounting records daily

Answer 1

		explanation
a.	preventive	This control is to prevent any kind of theft or misappropriation of cash.
b.	detective	This is to detect any frauds in using petty cash fund
c.	preventive	Checking by two people will help in preventing a few errors.
d.	detective	To detect any mistakes quickly.
e.	detective	to detect any errors in calculation of interest to be paid
f.	preventive	to prevent theft of checks
g	corrective	to correct if at all there is system failure and files cannot be accessed.