Professional Documents
Culture Documents
EXPENDITURE CYCLE
PART 2
PROCESS CONTROL
includes
computerized
procedures for updating files and
restricting access to data
Check Control
-A sequence control check should be
placed to compare the sequence of
each record in the file
Liability Validation Control
-Validation of the liability prior to
making payment
oPurchase Order
oReceiving Report
oSuppliers invoice
Valid
Vendor File
-consists of a list of vendors with
whom the organization normally
does business.
ACCESS CONTROLS
Access controls prevent and detect
unauthorized and illegal access to
the firms assets.
Traditional techniques:
Warehouse security
Moving assets
Paying employees
PHYSICAL CONTROLS
Include manual activities and
human actions to initiate computer
procedures to safeguard the assets
of the organization.
Purchases System Controls
Payroll System Controls
of inventory control
from the warehouse
Segregation of the general ledger
and accounts payable from cash
disbursements
Supervision of receiving
department
Reconciliation of supporting
documents
of time cards
Supervision
Paymaster
Payroll
imprest account
OUTPUT CONTROLS
Output controls are designed to
ensure that information is not lost,
misdirected, or corrupted and that
system processes function as
intended.
SUBSTANTIVE TESTS OF
EXPENDITURE CYCLE
ACCOUNTS
SEARCHING FOR
UNAUTHORIZED
DISBURSEMENT VOUCHERS
Review for multiple checks to
vendors
Corporate losses from multiple
payments to vendors for the same
merchandise have been estimated
to be in the hundreds of millions of
dollars per year.