Question

The principles of internal control include: ensure transactions and activities are authorized, maintain records, insure assets, separate recordkeeping and custody of assets, and perform internal and external audits.

true or false

Answer 1

Answer:

FALSE

Explanation:

Internal controls are the policies and procedures made to ensure that the business of an organisation works fine. These are the checks and balances put in place to ensure safeguarding assets, maintaining documentation, record keeping, etc.

The seven principles of internal control include: Ensuring transactions and activities are authorized, maintaining records, insuring assets, separate recordkeeping and custody of assets, but don't include performing internal and external audits. Performing physical audit of assets is one of the principles of internal control but performing internal or external audits is not part of the principles of internal control

Therefore, the given statement in the question is incorrect.

In case of any doubt, please comment.