Question

Discuss the accuracy of the following statements regarding internal control: The more computerized applications exist within...

Discuss the accuracy of the following statements regarding internal control:

  • The more computerized applications exist within a company’s accounting system, the lower the risk will be that fraud or errors will occur.
  • The more involved top management is in the day‐to‐day operations of the business, the lower the risk will be that fraud or errors will occur.

Homework Answers

Answer #1

The more computerized applications exist within a company’s accounting system, the lower the risk will be that fraud or errors will occur.It is not true because there are so many  risks related to computer data management .There are vulnerabilities related to the datas in the computer such as malware ,hacking,illegal monitoring of datas etc,.so there must be strong internal control in the organisation

The more involved top management is in the day‐to‐day operations of the business, the lower the risk will be that fraud or errors will occur. it is a true statement because top management are the creators of the business goals and objectives so they will try their best to achieve the targeted goals.Top management involvement in the day to day activities will result in a positive results

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