Accounting Multiple Choice Question – 26 November 2025

With regards to internal control systems in small entities, select whether each of the following statements is true or false:

A – Smaller companies are more likely to be successful in the implementation of segregation of duties controls
B – Management override is more likely to take place in smaller companies.

Select ONE answer:

1. Statement A – True, and Statement B – True
2. Statement A – False, and Statement B – False
3. Statement A – True, and Statement B – False
4. Statement A – False, and Statement B – True

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct => Small companies are less likely to be successful in the implementation of segregation of duties controls due to the limited number of employees available to segregate specific tasks within the various cycles. Given the limited number of staff in small companies and the dominance of management, controls are more likely to be overridden in smaller companies than larger ones.

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