Sales Order Process Risks and Controls – Flashcards
Unlock all answers in this set
Unlock answersquestion
approval of sales order prior to shipment, including establishing sales prices, payment terms and credit limits
answer
invalid customers, over-extended customers, unapproved pricing or incorrect amounts
question
approval of shipment for proper customer
answer
fictitious customers or wrong ones
question
separation of responsibility for authorization of new customers from custody of inventory
answer
fictitious customers
question
separation of custody of inventory from AR recordkeeping
answer
invalid sales or omitted transactions
question
SOD related to order entry,, credit approval, shipping billing IS and general accounting
answer
invalid transactions, omitted transactions
question
preparation of packing lists and shipping records on pre numbered forms
answer
omitted transactions
question
preparation of shipping log and packing list only when products have been shipped
answer
invalid transactions, omitted transactions, timing issues
question
initiation of the blind function and updating of the sales journal, inventory records, and customer AR records only when products have actually shipped
answer
invalid transactions, omitted transactions, timing issues
question
preparation of customer account statements
answer
wrong customers or incorrect amts
question
matching of key information on related documents prior to shipment
answer
invalid transactions, incorrect amounts or accounts, timing and duplicates
question
physical controls in inventory and shipping areas
answer
invalid sales or omitted transactions
question
IT controls over computer records and physical controls in inventory and shipping area
answer
invalid transactions, incorrect amounts or accounts, timing and duplicates
question
comparison of shipping records with sales journal and invoices
answer
omitted transactions, incorrect amts, wrong customers or timing issues
question
verification of recorded descriptions dates qty prices and accuracy
answer
incorrect amounts or timing problems
question
mathematical verification of sales journal and comparison to AT sub ledger and general ledger posting
answer
problems with the accumulation of transactions and transfer to GL and FS
question
review of AR records and comparison with sales invoices
answer
invalid customers, wrong customers, omitted transactions, incorrect amts
