Question

27) Petty cash is disbursed by Fred Haynes in the Cashier's Office. He also maintains records of disbursements, places requests to the Finance Department to replace expended funds, and periodically reconciles the petty cash balance. This represents a(an) ________ segregation of duties.

A) effective
B) ideal
C) ineffective
D) limited

Answer 1

The given scenario represents an effective segregation of duties where Fred Haynes handles all tasks related to petty cash.

Step-by-step explanation:

The given scenario represents an effective segregation of duties.

Petty cash handling process involves several steps, such as disbursing cash, maintaining records, requesting funds, and reconciling balances. In this case, Fred Haynes manages all these tasks, which ensures that one person is responsible for each duty and prevents any individual from having complete control over petty cash.

This segregation of duties helps to safeguard the organization's assets, reduce the risk of errors and fraud, and ensure proper accountability.