Module 4: Accounting Information Systems and Controls: Pt 1

Question 1

What are the 5 steps when designing an accounting information system?

Answer 1

Step 1: Break the process down into phases

Step 2: Consider the objectives for that phase

Step 3: Decide on the relevant documentation for the phase

Step 4: Consider the what can go wrongs (risks)

Step 5: Design controls to address these what can go wrongs (WCGW)

Question 2

Examples of key pieces of documentation: 
Purchase requisition
Purchase order 
Sales order 
GDN (Goods dispatched note) 
GRN (Goods received note)
Invoice 
Remittance advice 
Credit note

Answer 2

A purchase order is raised by the purchaser to send to the seller of goods to request purchase of goods or services. Prepared by purchasing department and sent to supplier

A sales order is raised by the seller of ordered goods to record the receipt of a purchase order from a customer. Prepared by sales team.

GDN is an internal form completed by dispatcher or ordered goods confirming the goods sent. Prepared by warehouse

GRN is an internal form completed by the warehouse confirming goods received.

Invoice is a document sent by the seller of goods or services to the buyer, detailing the amounts, discounts and payments. Prepared by finance department

Remittance advice is submitted by the buyer to seller outlining the nature and purpose of the payment. Sent to seller so they can match payment to invoice.

Credit note is sent to customer by seller when an item has been cancelled. Done by finance department.