Chapter 7: The Impact of Technology on Financial Control Flashcards
What is the FCD Department within a business
The financial control department’s role is to manage financial resources of the business.
What is the purpose of a General Corporate Ledger System
This system records all assets, liabilities, income and expenditure of the firm
What are common system impacts on financial control across different trading systems
Technical error
Human Error
Reference data error
What are the 9 functions of the main settlement system
Receiving real time data and enriching
sending and matching confirmations
reporting trades to regulators
sending settlement instructions
Receiving reports and updating records
Position management
Process changes due to COACs
Forward trade details to rec systems
Forward all the above to general ledger system
What does the reconciliation system do
Compares feeds about transactions, balances, and positions to data received from external agents so the bank can prove their records are correct
Define General Ledger
Also known as the nominal ledger, it is the main record of a business which uses the double-entry bookkeeping convention.
What is the double-entry principle
Based on the idea that each transaction is recorded in at least two ledger accounts - one debit and one credit
What are the seven categories which accounts are grouped in the general ledger
Assets
Liabilities
Revenue
Expenses
Gains
Losses
Shareholder’s Equity (Assets - Liabilities)
What is posting
Posting is the process of recording amounts as credits and as debits in the general ledger
What is a trial balance
The listing of the account names and the sum of the account balances
What is the purpose of a trial balance
To ensure that debits = credits at an early stage of the financial statement process
What are reference data items
A unique alphanumeric code to identify an account
The name of the account
A code to represent the type of the account
The identity of the currency in which postings are made for the account
What are balance information items
The opening balance for the account
The date of the opening balance
the closing balance of the account
the date of the closing account
What are transaction information items
The date that the transaction was carried out
Value date
entry date
the money value
a description
a code to represent the transaction
a configuration code
a unique translation reference number
What is the stock record
Keeps track of stock quantities and balances, also uses double entry convention
