Usually, most organizations will only produce information if its value exceeds its cost. There are two basic
situations, however, in which information may be produced even if its costs exceed its value.
1. It is often difficult to
14.1 Enforcing proper access controls and segregation of duties requires that a senior manager
review and suggest appropriate configuration of user rights in integrated ERP systems.
The default installation of ERP systems typically pr
12.2 Employees who have physical access to cash should not have responsibility for recording
or authorizing any transactions involving its receipt. Specifically, the following pairs of
duties should be segregated:
1. Handling cash or
15.3 Formal reports on employee performance are not intended to replace direct observation,
but to supplement it. Direct observation is important, but a manager cannot observe all
employees all the time. It is also difficult to accura
4.1 In a kiting scheme, cash is created using the lag between the time a check is deposited and
the time it clears the bank. Suppose a fraud perpetrator opens accounts in banks A, B, and
C. The perpetrator creates cash by depositing a
Is there appropriate segregation of duties?
What changes do you think should be made?
One of the most important controls in any accounting system is proper segregation of duties.
Segregation of duties serves as the primary defence against internal f
7.1(a) The "internal environment" refers to the tone or culture of a company and helps
determine how risk consciousness employees are. It is the foundation for all other
ERM components, providing discipline and structure. It is essent
4.1 Databases are possible because of their database management system (DBMS). As shown in
Figure 4.2, the DBMS is a software program that sits between the actual data stored in the system
and the application programs that use the dat
13.2 Vendor Managed Inventory (VMI) is essentially Electronic Data Interchange (EDI) where the
retailer has given their vendor access rights to their point-of-sale (POS) system. Some of the
potential advantages and disadvantages of mo
12.3 The accounts receivable aging report shows dollar amounts outstanding by number of
days past due by customer and by invoice. The following metrics can provide useful
early warnings about looming cash flow or bad-debt problem
NAREW SPORTS SUPPLY, YEAR-END WORKSHEET, DECEMBER 31, 2014
(Accounts with no activity in this worksheet are excluded in this solution.)