CIA2002

Accounting Information Systems

Session 2020/2021 Semester 1

Individual Assignment 2 (5%)

Lecturer : Profesor Madya Dr Noor Ismawati Jaafar

Date of Submission: 29th December 2020

Name Matric Number

Putri Anis Dianah Binti Hassan 17205853

Question 1
Sales order processing and credit approval; inventory control (record keeping) from
warehouse (custody); and general ledger from accounts receivable subsidiary ledger.

Question 2

 Credit check
 The company should periodically send an account statement to every customer
showing invoices and amounts paid by check number and date. This allows the
customer to verify the correctness of the records. If any payments are not recorded,
they will notify the company of the discrepancy. These control systems should not
be handled by the same person.

Question 3
Billing department matches the stock release copy of the sales order (from shipping) to the
invoice, ledger, and file copies of the sales order (sent directly to billing), and then mails the
invoice to the customer. After a certain amount of time has passed, the billing department
should investigate any unmatched invoice, ledger, and file copies of the sales order.
Question 4
More than one control procedures could be implemented to prevent fraud in an organisation
especially transactions in relation to cash. In this case, a billing system needs to be
established which bills both credit sales and cash sales. Here, the duties are to be segregated
among 2 people, one to prepare invoices/bills and one to collect payments. Finally the report
of debtors/ creditors needs to be monitored regularly (on weekly/monthly) basis followed by
surprise cash verification by the management.

Question 5
The three rules that ensure segregation of functions are:
 Transaction authorization should be separate from transaction processing
 Asset custody should be separate from asset record keeping.
 The organization structure should be such that perpetration of a fraud requires
collusion between 2 or more individuals.