Certified Internal Auditor (CIA) Part 1: Business Acumen — Question 139

Which of the following would be considered a primary control to reduce the risk associated with setting up duplicate vendors?

Answer options

• A. Receipt of a signed and approved vendor setup form.
• B. Segregation of duties between setting up vendors and making vendor payments.
• C. System validation and edit checks on vendor identification number.
• D. A vendor setup policy and procedure.

Correct answer: D

Explanation

The correct answer, D, highlights the importance of having formal policies and procedures in place to guide vendor setup, which helps prevent duplicates. Options A, B, and C are important controls but serve as secondary measures that support the primary control of having a comprehensive policy.