Give an example of “separation of duties “ in the accounting department of a small business _________________________________________________________________________________________________________________
In a small business example of separation of duties can be:-
1) Posting of accounting entry and approval of entry:
The person who passes the accounting entry should not approve the same. Accounting entries should be reviewed by other person who is not involved at all in the passing of accounting entry.
2) Person who makes payment and handle receipts should not prepare the bank reconciliation statement. It may so happen that to conceal receipts or show extra payments items pending reconciliation is shown incorrectly not coming to the notice of the management.
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