ACCA Strategic Professional · Strategic Business Leader · Management and internal control systems
Wexley Foods operates in several countries. The audit committee wants assurance that employees comply with anti-bribery laws and internal policies. Which control is primarily a detective compliance control rather than a preventive one?
Periodic internal audit testing of payments to agents is the detective control. It examines transactions after they occur to find bribery or policy breaches. Training, the code of conduct and legal pre-approval of contracts are preventive because they operate before a breach can happen.
- APeriodic internal audit testing of payments to agentsCorrect
- BMandatory anti-bribery training on joining
- CBoard-approved code of conduct
- DPre-approval of agent contracts by legal counsel
Explanation
Detective controls identify breaches after they happen. Internal audit testing of payments reviews transactions already made. Training, a code and pre-approval of contracts all act beforehand to prevent breaches.
Did you get it right without looking?
One question tells you little. A timed set on Management and internal control systems shows your real accuracy, how long you take and where you lose marks.
More Management and internal control systems questions
- Kestrel Logistics' board wants a framework for designing and assessing internal control across the whole organisation, covering a control en…
- Zenith Logistics Ltd is considering outsourcing its internal audit function to a firm of accountants. Management wants specialist IT audit s…
- Harlow Freight's warehouse manager raises purchase orders, approves supplier invoices and releases payments to suppliers without any second …
- Brindle Retail has an in-house internal audit team reporting to the finance director, who also approves its budget and annual plan. The team…
- Norvale Foods plc has a small finance team and no internal audit function. The audit committee asks whether it should set up an in-house int…
- Brightwell Ltd's external auditor has provided audit services for 12 years and, in the same period, also designed the company's new internal…