AYB221 - Part 1

What are some controls that can be used

Regular control account reconciliation Automated System exception reports Data Validation Batch Totals and hash totals Independent approval of budgets

What are some Revenue Cycle Threats?

Selling goods that are unavailable selling goods to customers who can't pay Creating fictitious sales Picking the wrong goods

What is the HRM & Payroll Cycle

The HRM & Payroll cycle consists of Hiring employee's and maintaining personnel. It also manages paying staff

What is a Journal Voucher used for?

Used to create a general journal entry

What is the Payroll activities

Validate timesheet Prepare payroll Disburse Pay Calculate Employer Paid benefits Disburse taxes and deductions

What and Who initiates the GL & Reporting

When a transaction occurs and it is recorded it starts the GL & Reporting Cycle

What is XBRL used for

XBRL is used when generating financial reports. XBRL uses special tags similar to xml

What is XBRL

eXtensible Business Reporting Language

What are the GL Activities

- Prepare Budgets - Update the General Ledger - Record GL Adjustments - Produce Reports

What are the HRM & Payroll Cycle Activities

1. Employee Recruitment 2. Payroll 3. Performance 4. Employee Termination

What are the main source documents used in the revenue cycle

Customer Order Sales Invoice

What software is used primarily in the revenue cycle

Customer Relationship Management Software

What tables does the revenue cycle require access to

Customer Table Inventory Table

What are the expenditure cycle activities

Determine demand for goods Order Goods Receive Goods Pay for goods

HRM & Payroll require access to?

Employee master data Current Period Production cycle data A/C Payable Data

What is ERP

Enterprise Resource Planning

What are some threats to HRM & Payroll?

Fictitious employees Inappropriate positions being advertised No new employee record generated Inaccurate timesheets Incorrect Pay Incorrect Leave Balances No Payment / Slow payment Theft of Pay Incorrectly reviewing performance Terminations not recorded Company assets remain with former employee

Which tables are used in the GL Database

General Ledger and Journal Table

Why would you use and Extended Account Code

If the company is large they may use extended account codes to divide departmental costs.

Which tables does the expenditure cycle require access to?

Inventory table Supplier table Purchase table

What is lead time

Lead time is the time it takes to restock a product.

As an auditor you have been tasked to investigate a companies AR process. How would Process Mapping help?

Process mapping shows who should do what task so there is a breakdown of where processes can be improved

What is the Revenue Cycle Process

Receive Customer Order Ship Goods Bill Customer Receive & Record Payments

What business decisions relate to GL

- Budgetary Considerations - Accounting policies and procedures

What is the key consideration for the expenditure cycle

Balance the supply and demand for products with cash flow considerations

Net Pay =

Gross pay - deductions

What is the main source document used in the expenditure cycle

Supplier Invoice

What is SCM

Supply Chain Management

What is the General Ledger & Reporting Cycle?

The GL & Financial reporting cycle summarizes adjusts and reports on data from all the previous operational cycles

What is the Expenditure Cycle

The expenditure cycle consists of all events that are involved in the purchase of goods and services and the payment for these goods and services

What is the Gl & Reporting Cycle Objective?

The objective of this cycle is to synthesise and report data. e.g. Budget Comparisons

What is the objective of the HRM & Payroll Cycle

The primary objective is to ensure staff are paid accurately and timely

What is the revenue cycle

The revenue cycle consists of all events that are involved in the exchange of goods and services with customers including the collection of payment

How is the revenue cycle initiated

The revenue cycle is initiated when the company receives a customer order and it is recorded by an employee

What are some threats that may occur in the expenditure cycle

Under/over estimating requirements Requesting unnecessary items Paying too much Buying poor quality products Receiving unordered goods Theft Data entry errors Errors in supplier invoice Paying an invoice twice Recording or posting errors Misappropriation of cash, cheques, EFT

What are some threats that can occur in the GL & Reporting cycle?

Under/overestimating revenue and expenditure Data Entry errors Incomplete Data Inaccurate Data Inaccurate Updating