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    Question

    Which of the following best describes the primary

    objective of a system of internal control in a large organization?
    A To eliminate all possible frauds and errors Correct Answer Incorrect Answer
    B To ensure reliability of financial reporting, safeguard assets, and promote operational efficiency Correct Answer Incorrect Answer
    C To detect fraud immediately after it occurs Correct Answer Incorrect Answer
    D To ensure compliance with tax laws only Correct Answer Incorrect Answer
    E To minimize audit procedures entirely Correct Answer Incorrect Answer

    Solution

    Internal controls provide reasonable assurance regarding operational efficiency, safeguarding assets, and accuracy of records. Fraud prevention is a benefit but not the sole objective.

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