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NEW QUESTION: 1
Which of the following controls would be most effective in assuring that the proper custody of assets in the
investing cycle is maintained?
A. Personnel who post investment transactions to the general ledger are not permitted to update the
investment subsidiary ledger.
B. The recorded balances in the investment subsidiary ledger are periodically compared with the contents
of the safety deposit box by independent personnel.
C. The purchase and sale of investments are executed on the specific authorization of the board of
D. Direct access to securities in the safety deposit box is limited to only one corporate officer.
Choice "D" is correct. An independent person comparing the contents of the safety deposit box with the
recorded balances in the investment subsidiary ledger is an effective control for assuring that the proper
custody of assets in the investing cycle is maintained.
Choice "A" is incorrect. Direct access to securities in the safety deposit box being limited to only one
corporate officer is a weakness in internal control since there is no independent verification of the box's
contents. Good internal control generally requires that two or more individuals be present when the safety
deposit box is opened.
Choice "B" is incorrect. While it is a good idea to have separate employees post investment transactions to
the general and subsidiary ledgers (so they can later be reconciled), this control relates to recordkeeping,
not to custody.
Choice "C" is incorrect. Authorization of the purchase and sale of investments by the board of directors is a
good control over the approval of investment transactions but does little to assure that proper custody of
assets is maintained.
NEW QUESTION: 2
192.168.1.1 and 192.168.1.251 are on the same network segment.
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