UNIVERSITY OF THE EAST - CALOOCAN CAMPUS

College of Business Administration

SY 2020 - 2021
BSA 3103 - Accounting Information System

NAME DE GUZMAN, JERMAINE N. CLASS ID:

SECTION BSA 2E DATE 09/13/2021

Module No. : 3 Activity No.: 2

Topic : Ethics, Fraud, and Internal Control

Key Terms
Define the terms below using your own words. Include also a description of the terms.

1. Access controls
➢ It is to ensure that only authorized personnel have a access to firm’s asset.

2. Accounting records
➢ It is the records or journals that is used and based on the business transactions of an
entity.

3. Accuracy
➢ It is reliable because the information is not bias and free from errors.

4. Application controls
➢ Controls that ensure the integrity of specific systems

5. Bribery
➢ It involves giving, offering or receiving money to an influential person, it might be an
official that will help you to conceal your wrong actions.

6. Business ethics
➢ It is the code of conduct that the manager of an entity must have. It is the recognition
of what is right or wrong in making decisions for an entity.

7. Completeness
➢ It means that there is no important aspect that is been omitted on the data.

8. Computer ethics
➢ It is the justification of policies that the must have in ethical use of the technology or
computers.

9. Computer fraud
➢ It is fraudulent activities that involving the use of computer and technology.
10. Conflict of interest
➢ When an individual acts on behalf of a third party during the discharge of his or her
duties or has self-interest in activity being performed.

11. Control activities

➢ Policies to ensure that the actions are appropriately taken to deal with the
organizations task,

12. Control environment

➢ It is the foundation of internal controls

13. Corrective controls

➢ Actions taken to reverse the effects of errors detected in the previous steps.

14. Data collection

➢ It is the process of gathering information and assessing if it is relevant to the
information that is needed.

15. Database management fraud

➢ It includes altering, deleting, stealing or corrupting an entity’s data to commit an
fraudulent actions.

16. Detective controls

➢ Second line of defense; it is a techniques and procedures to identify and expose
undesirable events that escape preventative controls.

17. Eavesdropping
➢ It is a theft of information as it is transmitted over a network by a computer,
smartphones or another connected device.

18. Economic extortion

➢ A threat or force by an individual or an organization to obtain something of value.

19. Employee fraud

➢ If an employee of an entity steals an asset of the entity for his/her personal benefit.

20. Ethical responsibility

➢ It is the responsibility of an organizations managers to seek a balance between risks
and benefits to their constituents that result from their decisions.
21. Ethics
• It is the character or principles of conduct of an individual that guiding them in making
the decisions that involves the concept of doing right or wrong actions.

22. Exposure
➢ It is weakness of a control to himself do fraudulent actions on the entity’s.

23. Fraud
• It is a false representation of material fact or the theft and concealment of an entity’s
asset for the personal gain of an individual.

24. General controls

➢ It is the controls that pertain to entity-wide concerns such as controls over the data
center, organization databases, systems development, and program maintenance

25. Illegal gratuity

➢ Giving, receiving, offering, or soliciting something of value because of the act of an
official that is beneficial to you.

26. Internal control system

➢ It comprises policies, practices and procedures employed by an organization to
safeguard the assets, measure the compliance with policies and procedures, ensure
accuracy and reliability, and to promote efficiency.

27. Lapping
➢ Cash receipts clerk first steals and cashes a check from customer A then uses a check
from customer B and applies it to customer A’s account.

28. Summarization
➢ It sums ups the company’s information and business transactions that can help the
entities to make future plans and actions.

29. Supervision
➢ It manages complex financial functions, including accounting and cash management.
If helps to ensure the efficiency and compliance of the employees and transactions of
an entity.

30. Timeliness
➢ The velocity of information must be delivered in time.
31. Transaction authorization
➢ Procedures to ensure that employees process only valid transactions within the scope
of their authority

32. Transaction fraud

➢ It is occurs when a stolen payment is used to generate an authorized transactions.

33. Verification procedures

➢ Independent checks if the accounting system to identify errors and
misrepresentations.