Segregation of Duties

Flood Inc. splits job functions in the revenue cycle among three accounting clerks. One clerk receives and processes all customer payments. A second clerk is responsible for depositing all cash receipts. A third clerk records all cash receipts in the accounts receivable records.

Which of the following statements is true?

Multiple Choice:

A) Flood Inc. has reduced the risk that customer accounts will become bad debt losses by properly segregating duties in its accounting department

B) Flood Inc. accounting department is likely inefficient because it is using too many clerks to perform basic recordkeeping tasks

C) Flood Inc. has reduced the risk that an employee could steal cash receipts and conceal the theft in the accounting records

D) Flood Inc. is wasting resources by unnecessarily segregating related job functions