How are fraud and error detected and prevented by an entity's internal control system?

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How are fraud and error detected and prevented by an entity's internal control system?

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Answer 1

Answer #1

Fraud and error detected and prevented by an entity's internal control system by applying the following controls:-

1. Control over the source to end of transactions is distributed among many so that abuse of power cannot occur.

2. Periodical reconciliation of bank account.

3. Use of credit cards of the company is restricted.

4. Ensure us of organization assets like vehicles etc only for official purpose.

5. Petty cash fund and other funds are protected.

6. Restriction on use of related party transactions.

7. Protection of cash and checks from fraudulent use.

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How are fraud and error detected and prevented by an entity's internal control system?

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When obtaining an understanding of an entity's internal control in a financial statement audit at a...

When obtaining an understanding of an entity's internal control in a financial statement audit at a...

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How are fraud and error detected and prevented by an entity's internal control system?

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