Reconciliations are an example of which type of control?

Reconciliations are an example of which type of control?

• A. Detective controls.
• B. Preventive controls.
• C. Corrective controls.
• D. Compliance controls.

Answer: (A)

Reconciliations are used to compare two sets of records (such as a cash ledger and a bank statement) to uncover any differences. This is a detection activity—its job is to identify discrepancies so they can be investigated and addressed. That’s why reconciliations are classified as detective controls: they reveal problems after transactions have occurred. Preventive controls aim to stop issues from happening in the first place, compliance controls ensure adherence to laws and policies, and corrective controls respond to problems after detection to fix or remediate them. Reconciliations can lead to corrective actions, but their primary purpose is to detect.

Reconciliations are used to compare two sets of records (such as a cash ledger and a bank statement) to uncover any differences. This is a detection activity—its job is to identify discrepancies so they can be investigated and addressed. That’s why reconciliations are classified as detective controls: they reveal problems after transactions have occurred. Preventive controls aim to stop issues from happening in the first place, compliance controls ensure adherence to laws and policies, and corrective controls respond to problems after detection to fix or remediate them. Reconciliations can lead to corrective actions, but their primary purpose is to detect.