The policies and procedures adopted by management to assist in achieving orderly and efficient conduct of business is known as: MCQ with Answer and Explanation

Question

The policies and procedures adopted by management to assist in achieving orderly and efficient conduct of business is known as:

A. Internal Control

B. Vouching

C. Statutory Audit

D. Continuous Audit

Answer: Option A

Solution (By JKSSB Mock Tests)

Internal control is the system designed by management to safeguard assets, ensure accurate records, and promote operational efficiency.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

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Social audit differs from financial audit mainly because:

A. It focuses solely on tax evasion

B. It examines social impact and ethical behavior rather than just financial accuracy

C. It is done on a daily basis

D. It is always conducted by the CAG

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Correct Answer: Option B

Explanation:
A social audit evaluates how well a company is achieving its social objectives and its impact on the community and environment.

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Question #2

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The 'Key Audit Matters' (KAM) are required to be reported in the auditor's report for:

A. Listed entities (and certain other cases when required by law or voluntarily)

B. All entities

C. Only banks

D. Only insurance companies

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Correct Answer: Option A

Explanation:
KAM reporting is mandatory for listed entities as per SA 701.

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Question #3

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The 'Accrual System' of accounting records transactions:

A. At the end of year

B. When cash is received or paid

C. When they become due (earned/incurred)

D. On order placement

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Correct Answer: Option C

Explanation:
Accrual basis recognises income when earned and expenses when incurred, regardless of cash flow.

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