Question

Purpose of internal check system is to _______________.

• A. Have an accurate record of all the business transactions
• B. Know the accounting method followed in the business
• C. Plan for future audit works and to prevent occurrence of frauds and errors
• D. Ascertain the profit, earning capacity of the business

Answer 1

The correct option is C Plan for future audit works and to prevent occurrence of frauds and errors

Internal audit means where an internal auditor helps the company achieve the objectives of the company. Internal auditing ensures that the books of accounts are free from errors and frauds. Internal audit is basically a check on the internal control system. The management sets up the internal control system and delegates the authority to the internal control department.