week 11 - Week11_internal-controls

week 11 - Week11_internal-controls - A Framework for...

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A Framework for Evaluating Internal Controls A Framework for Evaluating Internal Controls Dr. Myles Stern ACC 5130 (513LEC12)
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Expanding Risks Expanding Risks $ Integrated accounting systems that minimize the traditional paper trail $ Sophisticated accounting software $ Multi-user software $ Computer networks $ Wireless networks $ Remote access $ Inter-site networking $ E-Commerce
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Increased Emphasis on Internal Control Increased Emphasis on Internal Control Sarbanes-Oxley
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Five Levels of Internal Control Five Levels of Internal Control 1 Preventive 2 Immediate discovery 3 Discovery in time for recovery 4 Discovery without recovery 5 No discovery Balance cost of the control against its benefit.
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The Model: Three Areas of Control The Model: Three Areas of Control General controls The overall structure and environment of the system User controls People who use the system Application controls The specific software applications and related, non-computer procedures
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General Controls General Controls Why are these controls so crucial? Organization of management and the IS function Who is in charge of computer operations? What is the owner's (senior manager's) role? Who works with the accounting system? Who else has access to the computer? Range of applications
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General Controls General Controls Hardware and operating system controls Describe the computer system. Host computers and servers Location of central computers Type of network and version/level Types of workstations
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General Controls General Controls What system-level security has been set up? Groups of users
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General Controls General Controls $ Is there any remote access or inter-site networking? % Examples % Windows xp Remote Desktop % pcAnythere % GoToMyPC % Terminal Services % Citrix Metaframe % VPN: Virtual Private Network The Internet Terminal or Citrix Server Remote User Office Desktop Computer
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General Controls General Controls $ Internet Access % Describe the connection. % Do critical applications depend on the connection?
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week 11 - Week11_internal-controls - A Framework for...

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