Question

Which of the following is not an example of segregation of duties in the property management process?

A. The employee responsible for taking a physical inventory of property should be independent of the record-keeping function.
B. The employee who computes depreciation for accounting purposes should be separate from the employee who computes depreciation for tax purposes.
C. The property records function should be separate from the custodial [handling of assets] function.
D. The property records function should be separate from the general ledger function.

Answer 1

Option B is not an example of segregation of duties as it does not address the risk of theft or misuse of property, but instead involves different methods of record-keeping for depreciation.

Step-by-step explanation:

The question pertains to segregation of duties within the property management process, focusing on which tasks should be performed independently to maintain internal control within an organization. After evaluating the options provided, the one that is not an example of segregation of duties is option B: "The employee who computes depreciation for accounting purposes should be separate from the employee who computes depreciation for tax purposes." Although it is often beneficial to have these functions performed separately for the purposes of checks and balances, it does not specifically target the risk of theft or misuse of property, which is typically the focus of segregation of duties. Both computations deal with record-keeping and analysis rather than physical control over assets. In contrast, options A, C, and D are clear examples of segregation of duties, where the physical inventory and custodianship of assets are maintained separately from the function of record-keeping and accounting to prevent conflicts of interest and reduce the risk of fraud and errors.