What does segregation of duties mean on the CPA exam?
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Segregation of duties. Splitting a sensitive process so no one person can both commit and conceal an error or fraud. Authorization, custody and record-keeping belong to different people.
Defined against NIST SP 800-53 AC-5.
Other names for segregation of duties
separation of duties
Related terms
- due diligence: The specific inquiry, documentation and record-keeping a preparer must perform before claiming certain credits or head-of-household status.
- those charged with governance: The people responsible for overseeing the entity's strategic direction and its accountability, including the financial reporting process.