Question

If management identifies even one material weakness in internal control, then management will conclude that the organization’s internal control over financial reporting is not effective.1. True2. False

Answer 1

Answer:

Statement is true

Explanation:

Internal control over financial reporting was designed to give assurance related to financial statements preparation and authenticity of financial reporting.

Material weakness refers to inefficiency in internal control which could lead to misstatement in financial statement thereby making financial reporting unreliable. As such, even one material weakness would prove ineffective internal control over financial reporting.