Multiple choice

Directions: Choose the correct option for the given question.

Consider the following statements: Accounting control comprises

  1. The plan of organization concerned with decision process.
  2. The plan of organization concerned with safeguarding of assets.
  3. The procedure concerned with safeguarding of assets. Which of the statements given above are correct?

  1. (1) and (2) only

  2. (2) and (3) only

  3. (1) and (3) only

  4. All of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Statement 1 is incorrect - decision-making processes are management functions, not accounting controls. Accounting controls focus on safeguarding assets and reliability of financial records. Statement 2 is correct - accounting controls include the organizational plan for asset safeguarding. Statement 3 is correct - accounting controls include specific procedures designed to protect assets. The core purpose of accounting controls is asset protection, not decision-making.

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