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IS 414 > IS 414 CH. 12 (Systems and Docs) > Flashcards

IS 414 CH. 12 (Systems and Docs) Flashcards

1
Q

What are the 4 systems?

A
  1. Sales Order Entry
  2. Shipping
  3. Billing
  4. Cash Collections
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2
Q

General issues throughout the cycle

A
  1. Inaccurate or invalid master data
  2. Unauthorized disclosure of sensitive information
  3. Loss or destruction of data
  4. Poor performance
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3
Q
  1. Inaccurate or invalid master data
A
  1. 1 Data processing integrity controls
  2. 2 Restriction of access to master data
  3. 3 Review of all changes to master data
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4
Q
  1. Unauthorized disclosure of sensitive information
A
  1. 1 Access controls

2. 2 Encryption

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5
Q
  1. Loss or destruction of data
A

3.1 Backup and disaster recovery plan procedures

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6
Q
  1. Poor performance
A

4.1 Managerial reports

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7
Q

Sales order entry subsystems

A
  1. Taking customer orders
  2. Checking and approving credit
  3. Checking inventory
  4. Responding to customer inquiries
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8
Q

Taking customer orders threats

A
  1. Incomplete/inaccurate orders
  2. 1 Data entry controls
  3. 2 Restriction of access to master data
  4. Invalid orders
  5. 1 Digital signatures or written signatures
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9
Q

Checking and approving credit threats

A
  1. Uncollectible accounts
  2. 1 Credit limits
  3. 2 Specific authorization to approve sales to new customers or sales that exceed a customer’s credit limit
  4. 3 Aging of A/R
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10
Q

Checking inventory threats

A
  1. Stockouts or excess inventory
  2. 1 Perpetual inventory system control
  3. 2 Use of barcode or RFID
  4. 3 Training
  5. 4 Periodic physical counts of inventory
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11
Q

Responding to customer inquiries threats

A
  1. Loss of customers

9. 1 CRM systems, self-help websites, and proper evaluation of customer service ratings

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12
Q

Shipping subsystems

A
  1. Pick and pack

2. Ship goods

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13
Q

Pick and pack threats

A
  1. Picking the wrong items
  2. 1 Barcode & RFID
  3. 2 Reconciliation of picking lists to sales order details
  4. Theft of inventory
  5. 1 Restriction of physical access to inventory
  6. 2 Documentation of all inventory transfers (shipping and warehouse employee sign or make appropriate acknowledgement of the transfer online)
  7. 3 RFID and barcode
  8. 4 Periodic physical counts of inventory and reconciliation to recorded quantities
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14
Q

Ship goods threats

A
  1. Shipping errors (delay or failure to ship, wrong quantities, wrong items, wrong addresses, duplication)
  2. 1 Reconciliation of shipping documents with sales orders, picking lists, and packing slips
  3. 2 Use RFID systems to identify delays
  4. 3 Data entry via bar-code scanners and RFID
  5. 4 Data entry edit controls (if shipping data entered on terminals)
  6. 5 Configuration of ERP system to prevent duplicate shipments
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15
Q

Billing subsystems

A

Invoicing

Update A/R

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16
Q

Invoicing threats

A
  1. Failure to bill
  2. 1 Separation of billing and shipping functions
  3. 2 Periodic reconciliation of invoices with sales orders, picking tickets, and shipping documents
  4. Billing errors
    14.1 Configuration of system to automatically enter pricing data
    142 Restriction of access to pricing master data
    14.3 Data entry edit controls
    14.4 Reconciliation of shipping documents (picking tickets, bill of lading, and packing ticket) to sales orders
17
Q

Update A/R threats

A
  1. Posting errors in A/R
  2. 1 Data entry controls
  3. 2 Reconcilation of batch totals
  4. 3 Mailing of monthly statements to customers
  5. 4 Reconciliation of subsidiary accounts to general ledger
  6. Inaccurate or invalid credit memos
  7. 1 Segregation of duties of credit memo authorization from both sales order entry and customer account maintenance
  8. 2 Configuration of system to block credit memos unless there is either corresponding documentation of return of damage goods or specific authorization by management
18
Q

Cash collections threats

A
  1. Threft of cash
  2. 1 Segregation of duties - the person who handles (deposits) payment from customers should not also post remittances to customer accounts, create or authorize credit memos, or reconcile the bank account
  3. 2 use of EFT, FEDI, and lockboxes to minimize handling of customer payments by employees
  4. 3 Obtain and use UPIC to receive EFT and FEDI payments from customers
  5. 4 Immediately upon opening mail, create list of all customer payments received
  6. 5 Prompt, restictive endorsement of all customer checks
  7. 6 Having two people open all mail likely to contain customer payments
  8. 7 Use of cash registers
  9. Cash flow problems
  10. 1 Lockbox arrangements, EFT, or credit cards
  11. 2 Discounts for prompt payment by customers
  12. 3 Cash flow budget

IS 414 (23 decks)

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