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Chapter 08 - Consideration of Internal Control in an Information Technology Environment
CHAPTER 8
Consideration of Internal Control

in an Information Technology Environment
Review Questions
8–1 System software monitors and controls hardware and provides other support to application programs.
The computer's operating system and utility programs are important components of system software.
Application software consists of programs that perform specific tasks, such as updating the accounts
receivable master file.
8–2 End user computing makes the user responsible for the development and execution of the IT
application that generates the information employed by that same user. In end user computing a user
frequently uses off-the-shelf software on a personal computer (work station). A distributed data
processing network uses communication links to share centralized data and programs among various
users in remote locations throughout the organization.
8–3 A local area network interconnects computers within a limited area, typically a building or a small
cluster of buildings.
8–4 User control activities are procedures applied by users to test the accuracy and reasonableness of
computer output. Manual application control activities typically involve information system
employee follow-up of items listed on computer exception reports.
8–5 Internal labels are machine-readable messages at the beginning and end of a tape or disk file. The
header label, at the beginning, identifies the file and its creation date, and the trailer label marks the
end of the file and usually includes one or more control totals. External labels are gummed paper
labels placed on the outside of a tape or disk pack to identify its contents. Both internal and external
labels are designed to prevent computer operators from processing the wrong files.
8–6 The term general control activities is used to describe controls that apply to all or many IT systems in
an organization. General control activities include controls over the development of programs and
systems, controls over changes to programs and systems, controls over computer operations, and
controls over access to programs and data.
Application control activities are controls that apply to specific computer accounting tasks,
such as the updating of accounts receivable. This category includes programmed controls embedded
in computer programs and manual follow-up activities consisting of follow-up procedures on
computer exception reports.
8-1
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8–7 No. While it is true that many duties that might be separated in a manual system are combined in an
information systems department, separation of duties is still an important means of achieving internal
control. The separation of duties in an information systems department follows a somewhat different
pattern than in a manual system. In the latter, duties are separated to enable independent records to be
maintained and reconciled. In an information systems department, many records can be maintained
and reconciled by computer. However, separation of duties is necessary so that no one employee is in
a position to make unauthorized changes in programs or data files. This is accomplished largely
through separation of responsibilities for programming, computer operations, and custody of
programs and files.
Several traditional separations of duties are also applicable to IT systems. Since the computer
performs largely a recordkeeping function, information systems personnel should not have custody
of, or control over, assets. Also, information systems personnel should not authorize or initiate
transactions. When transactions are initiated elsewhere in the organization, an independent record is
usually created that establishes control over the information systems department.
8–8 An online, real-time system is one in which input devices are in direct (online) communication with
the computer and all relevant files are instantaneously updated (real-time) by input data.
8–9 Documentation in an information systems department consists of an orderly description of the system
and procedures used in all data processing tasks, so that a complete historical record exists of the use
of documents, program changes, and so on.
One important form of documentation is system documentation, describing an overall
processing system. System documentation includes system flowcharts and descriptions of the nature
of input, output, and operations controls. System documentation in the user's manual describes the
procedures for entering data, reviewing output, and reprocessing erroneous data.
The details of application programs should be described by program documentation, including
such elements as a description of the purpose of the program, program flowcharts, operating
instructions for processing the programs, and control sheets for approving programs and changes in
programs. Computer operators are provided with the operations manual, consisting of one type of
program documentation—the operating instructions for processing the program.
Auditors use the client's documentation in obtaining an understanding of internal control, and
in planning audit procedures that make use of the client's computer such as generalized audit
programs. Good documentation provides the auditors with much of the background necessary to
develop effective test data.
8–10 The minimum amount of segregation of duties in an information systems department requires that
programming be separate from the functions of operating the computer and controlling input to the
computer. Also, computer operators should not have custody or detailed knowledge of computer
programs.
8–11 The data control group is concerned with the day-to-day operation of controls, such as preparing
batch control totals, reviewing computer activity logs, reprocessing errors, and distributing output.
Internal auditors, on the other hand, do not usually perform routine control activities. Rather, they
test and evaluate the effectiveness of existing controls with the purpose of making recommendations
for improving the system. Internal auditors often participate in the design of internal controls and
subsequently monitor all aspects of the system, including administrative controls and the activities of
the data control group.
8-2
8–12 a. Record counts are totals that indicate the number of documents or transactions processed; the
record counts are compared with totals determined before processing. The purpose of the
record count control is to compare the computer-developed totals with the predetermined
totals to detect the loss or omission of transactions or records during processing.
Unauthorized transactions may also be detected by record counts.
b. The limit test control in the computer program compares the result of computer processing
against a minimum or maximum amount. The purpose of the limit test is to determine
whether certain predetermined limits have been exceeded. Violations are usually printed out
for follow-up action.
c. A validity test involves the comparison of data against a master file or table for accuracy. For
example, employee numbers may be compared with a master file of all valid employees. The
purpose of validity tests is to determine that only legitimate data is processed.
d. Hash totals are sums of data that would ordinarily not be added, such as unit prices, invoice
numbers, and so on. These items are added before processing for later comparison with a
total of the same items accumulated by the computer. The purpose of the hash total control is
to provide assurance that all, and only authorized, records were processed.
8–13 A system flowchart is an overall graphic representation of the flow of documents and operations in
the entire data processing application. A program flowchart, in contrast, is a representation of the
major steps and logic of a single computer program.
8–14 Data transmission controls include (only three required):
(1) Parity checks—A redundant bit added to data that may be used to verify the integrity of the
information as it is processed or transmitted.
(2) Data encryption—A coding of data to make it difficult for unauthorized individuals to read
the information.
(3) Message acknowledgment techniques—Techniques to help ensure that the receiving device
receives a complete message. One such technique is an echo check in which the receiving
device sends a message that verifies a transmission back to the sending device.
(4) Private lines—Telephone lines that are owned or leased by an organization and are secure.
8–15 There is an increased risk of unauthorized use of workstations because the machines are located in
user work areas. To reduce this risk, system software should maintain a log of computer activities for
management review. Also, the workstation's operating system should require authorization codes to
be entered to gain access to menus that control specific programs and files. Use after business hours
may be prevented by locking away critical programs or replacing the computer operating switch with
a key lock.
8–16 Telecommunications is the electronic transmission of information by radio, wire, fiber optics,
microwave, laser, and other electromagnetic systems. (For example, owners of two computers may
transmit information through the use of their computers, modems, and fiber optics.)
8-3
8–17 In distributed data processing systems small business computers, located throughout the company, are
linked to a main computer. Users may access programs and files in the main computer and perform
limited data processing activities in their own departments.
8–18 Electronic data interchange is a system in which data are exchanged electronically between the
computers of different companies. The audit trail is affected in that "hard copy" source documents
(e.g., invoices, purchase orders, checks, bills of lading) are replaced with electronic transactions
created in a standard format.
8–19 While it is technically possible for an IT system to operate without leaving an audit trail, it is
improbable that this will ever occur in an actual system used by a business entity. Valid business
reasons exist for the deliberate inclusion of an adequate audit trail in even the most sophisticated IT
system. One reason is the practical need for a "management trail," equivalent to an audit trail, which
enables management to determine the status and effects of individual transactions. In addition, the
Internal Revenue Service and other government agencies require businesses to maintain an audit trail
permitting individual transactions to be traced back to their source or forward to the summary totals.
Also, businesses that are audited annually usually are anxious to accommodate the needs of their
independent auditors in order to reduce the time and cost of the audit.
8–20 The auditors usually begin their consideration of internal control over IT activities with a review of
the general controls. This is an efficient approach since application control activities cannot be
effective in the absence of general control activities over all IT activities. When the auditors discover
that generally control activities are weak, they often decide it is unproductive to test specific
application control activities.
8–21 When using the tagging and tracing technique, the auditors tag input transactions with an indicator
before they are processed. A computer routine provides a printout of the steps used in processing the
tagged transactions. The auditors may then review the printout for unauthorized processing steps.
Questions Requiring Analysis
8–22 The characteristics of a satisfactory plan of organization for an information systems department are as
follows:
(1) The information systems department should have as much autonomy from major user
departments as is reasonably possible. One means of achieving this autonomy is to have the
information systems manager report directly to a vice president of information systems. If
information systems are units within the accounting department, the controller should not
have direct contact with computer operations.
(2) Within the data processing portion of the information systems department there should be
physical and organizational separation of the computer processing unit, the library, and the
systems and programming units. Duties of the programmers and the operators should be
distinctly separated, and access to the computer center, programs and data should be
restricted to authorized persons.
(3) A separate data control group should review the activities of the information systems
department.
8-4
8–23 Batch processing refers to a system in which source documents are collected into "batches" for
processing in sequence as one lot. Accumulation of batches means that processing takes place only
periodically. Thus, records and files are only as current as the data in the last batch processed.
In an online, real-time system (OLRT), input terminals are in direct (online) electronic
communication with the central processing unit. Data entered through these online terminals causes
instantaneous (real-time) updating of all relevant files. In an OLRT system, the results of processing
a transaction are immediately available and may even influence the completion of the transaction.
For example, if a credit sale is entered through an online terminal, the computer would immediately
notify the terminal user if that transaction caused the customer's account to exceed a predetermined
credit limit. In a batch processing system, the fact that the customer's credit limit had been exceeded
would not be known until the batch of credit sale documents containing that transaction had been
processed.
Internal control over input is more easily attained in a batch processing system than in an
OLRT system. The concept of a "batch" of input data permits such controls as accounting for the
numerical sequence of source documents, control totals, hash totals, and item counts. These input
controls provide substantial assurance that no data is omitted, added, transposed, or otherwise
misstated between the original recording of the transaction and the completion of processing. In an
OLRT system, these "batch controls" are no longer applicable. Also, if transaction data are entered
directly into terminals, there may be no "hard-copy" source documents for later reference if a
transaction is misprocessed.
As compensating controls in an OLRT system, access to terminals is limited to authorized
users, and the operating system should be programmed to maintain terminal activity logs to be
reviewed for unauthorized use. Also, input validation checks, such as validity tests and limit tests,
should be applied to data as it is entered. Still, these controls often are less effective than batch
controls in preventing omissions, additions, or misstatements of input data.
8–24 a. In general, personal computers are less flexible, slower at processing data, and smaller in
terms of storage capacity than larger computers.
b. Auditors are concerned with controls over personal computers whenever they are used by the
client to process or access financial data. In those situations, use of the personal computers
may affect the reliability of the client's financial information.
8–25 Other than test data, methods commonly used for testing processing controls in an IT system include
using an integrated test facility, controlled programs, program analysis, tagging and tracing, and
generalized audit software.
The integrated test facility approach uses a subsystem of dummy records and files built into the
regular data processing system. The auditors monitor the processing of test data, studying the effects
upon the dummy files, exception reports, and other output produced, and the follow-up of exceptions
by the data control group.
Controlled programs involve the processing of current data by using a duplicate program that is
held under the control of the auditors. The output is then compared to the output developed by the
client's copy of the program.
The program analysis technique involves the use of software that generates a flowchart of the
logic of the client's application programs that may then be reviewed by the auditors for unauthorized
program steps.
The tagging and tracing of transactions approach involves the selection of certain transactions
as they are entered into the system and using software to follow these transactions throughout the
various processing steps, each of which if normally printed. Unauthorized processing steps may be
detected by reviewing the listing.
8-5
Another approach to testing processing controls is processing selected input data using
generalized audit software and comparing the results to those obtained by the client's programs. This
approach, termed "parallel simulation," is similar to using controlled programs in that current or
historical live data may be tested without placing reliance upon the client's equipment or IT
personnel.
An inherent limitation in most of the testing methods described above is that agreement
between the client's processing results and those obtained by the auditors provides no assurance that
the client's system contains processing controls that would detect types of errors not present in the
selected input data. For this reason, auditors may use test data in conjunction with the other testing
methods.
8–26 Generalized audit software can be used to aid the auditor in examining accounts receivable in a fully
computerized system by performing such tasks as:
a. Examining records for quality, completeness, and valid conditions. For instance, customer
accounts might be scanned for account balances in excess of credit limits.
b. Rearranging data and performing analyses useful to the auditors. The audit software might
be used to arrange the accounts receivable file in the form of an aged trial balance to assist in
the evaluation of the allowance for doubtful accounts.
c. Selecting and printing confirmation requests. The program can include instructions to select
a sample of accounts receivable using any quantifiable selection criteria including a statistical
sample. Also, considerable time can be saved by having the computer print the confirmation
requests.
d. Comparing duplicate data maintained in separate files. For example, the changes in
accounts receivable during a given time period can be compared with the detail of credit sales
and cash receipts transactions files.
e. Comparing confirmation information with company records. For example, the computer can
be used to compare payment dates indicated on customer confirmations with client cash
receipts records.
8–27 An integrated test facility (ITF) is a testing subsystem that is built into the client's processing system.
The major advantage of using the technique is that it allows continuous testing of the system. Also,
test data is processed with actual data ensuring that the programs tested are the same as those actually
used to process transactions.
One disadvantage of the ITF approach is the possibility that personnel may manipulate real
data using the test system. Also, there is a risk that the client's real financial records may be
contaminated with the test data.
8–28 a. When a service center processes a company's records, the company should establish controls
to test the accuracy of the center's activities. Control totals should be developed for input
transactions and later reconciled to the center's output. In addition, the company’s personnel
should test a sample of the computations performed by the service center’s computer.
b. When information is not available from a service auditors' report, the auditors of a client
using a service center may find it necessary to visit the center to consider the center's internal
control. At the center, the auditors obtain an understanding of the internal control.
8-6
c. Service centers often engage their own auditors to review their processing controls and
provide a report for the users of a center and the users' auditors. These reports are known as
service auditors' reports.
d. The service auditors may provide a report on management’s description and design of its
controls (Type 1 reports) or that plus operating effectiveness (Type 2 reports).
e. A Type 1 report provides the user auditors with an understanding of the prescribed controls at
the service center. It provides no basis for reliance on service center controls, because it does
not report the results of tests of controls. A Type 2 report may provide a basis for the user
auditors' to reduce their assessments of control risk.
Objective Questions
8–29 Multiple Choice Questions
a. (2) LAN is the abbreviation for local area network, a network that interconnects
computers within a limited area, typically a building or a small cluster of buildings.
b. (3) End user computing is most likely in a personal computer environment. End user
computing involves environments in which a user department is responsible for
developing and running an IT system with minimal or no support from the central
information systems department.
c. (1) The exception report should be reviewed and followed up on by the data control
group, which also tests input procedures, monitors IT processing, handles the
reprocessing of exceptions, and reviews and distributes all computer output.
d. (1) A validity check compares data (for example, vendors or employees) against a master
file for authenticity. Accordingly, a validity test will prevent the positing of a
payable to a vendor not included in the online vendor master file.
e. (3) In an online, real-time system, users enter individual transactions from remote
terminals and files are updated immediately. Therefore, it is important that control be
established over computer files through a system of user identification numbers.
f. (3) A distributed data processing system is one in which communication links are used to
share date and programs among various users in remote locations throughout the
organization. Accordingly, access controls in such a system gain importance.
g. (3) The assessment of “computer control risk” is a vague term and ordinarily there is no
assessment of “computer control risk.” Accordingly, it is least likely that auditors
will use software to assess it.
h. (2) Auditors use utility programs to perform routine processing functions such as sorting
and merging. Generalized audit software programs are utility programs.
i. (2) When deciding whether to engage an information technology specialist, it is doubtful

that the auditor would consider the number of financial institutions at which the client
has accounts as increases in that number itself doesn’t necessarily result in a more
8-7
complex computer application. The other replies all involve factors making such an
application more complex.
j. (2) Generalized audit software allows the auditors to independently process their clients'
records. The software is flexible and may be used on a variety of IT systems. These
packages have not all been written in one language and their use should have no
effect on the auditors' need to obtain an understanding of internal control, as
indicated in answers (1) and (3). Generalized audit software is primarily used as a
tool for performing substantive tests; the software is of limited value in tests of
controls.
k. (2) User IDs and passwords for the various users may be used to restrict access to the
computer in a manner so as to prevent unauthorized access to sensitive programs.
l. (3) The test data method is used to test controls contained within the program. The audit
approach is that of identifying relevant controls within the computer program, and
then preparing transactions to run through that program to determine whether the
controls operate effectively.
8–30 a. False f. False

b. True g. True
c. True h. True
d. False i. True
e. True
8–31 Definitions
a. 1 Auditing around the computer involves examining input into and outputs from the computer
while ignoring the processing.
b. 6 Test data is a set of dummy transactions developed by the auditor and processed by thee
client’s computer programs to determine whether the controls that the auditor intends to rely
upon are functioning as expected.
c. 3 An integrated test facility introduces dummy transactions into a system in the midst of live
transactions and is often built into the system during the original design.
d. 3 An integrated test facility approach may incorporate a simulated division or subsidiary.
e. 4 Parallel simulation involves processing actual client data through the auditor’s software to
determine whether the output equals that obtained when the client processed the data.
8–32 Definitions
a. 2 Data warehouse
b. 1 Batch processing
c. 5 End user computing
d. 3 Database system
e. 4 Decentralized processing system
Problems
8–33 SOLUTION: Ultimate Life Insurance Company (Estimated time: 25 minutes)
a. A database is an integrated set of data elements that is shared by two or more application
programs.
8-8
b. The fundamental advantage of a database is the elimination of data redundancy, which (1)
reduces data storage costs, and (2) avoids the problem of data inconsistencies. Also, a
database provides management with direct access to large amounts of data for decision
making.
c. The integrity of the database may be safeguarded by limiting access to terminals, through the
use of locks or user identification codes. A system of authorization (i.e., passwords) may be
established to assure that only authorized personnel have access to specific elements of the
database. To prevent access after business hours, terminals may be disabled during those
hours. In addition, improper use of the terminals may be detected by reviewing computer
generated logs of terminal activity.
8–34 SOLUTION: IT Auditing Approaches (Estimated time: 30 minutes)
a. Auditing "around" the computer is an audit approach to testing the reliability of computer
processing without the auditors actually making use of the computer. The auditors manually
process samples of transaction input data, compare their results with those obtained by the
client's computer processing, and investigate any material discrepancies. This approach to
the audit of IT-based systems is often contrasted with auditing "through" the computer. In
the latter approach, the auditors make use of computer-assisted techniques in performing their
testing procedures.
b. CPA's may decide to audit "through" the computer instead of "around" it (1) when the IT
applications become complex, (2) when the audit trail becomes partly obscured (as, for
example, when transaction data are originally entered into an online terminal without the
preparation of source documents), and (3) when it is more efficient than auditing around the
computer.
Auditing "around" the computer will be inappropriate and ineffective when a major
portion of the internal control is embodied in the computer and when accounting information
is intermixed with operating information in a computer program that is too complex to permit
ready identification of inputs and outputs. Auditing "around" the computer will also be
ineffective if the sample of transactions selected for testing does not include unusual
transactions that require special treatment.
Auditing "through" the computer can provide direct assurance as to the functioning of
the system and affords the opportunity to test specific controls. This technique is necessary
for assessing control risk in all but very simple IT systems.
c. (1) "Test data" is a set of data in some machine readable form (historically on punched
cards) representing a full range of simulated transactions, some of which may be
erroneous, to test the effectiveness of the control activities and to ascertain how
transactions would be handled (accepted or rejected) and, if accepted, the effect they
would have on the accumulated accounting data.
(2) CPAs may use test data to gain a better understanding of how the computer processes
data. Test data may be used to test the accuracy of programming by comparing
computer results with results predetermined manually. Test data may also be used to
determine whether or not the system is capable of detecting various types of error
conditions. Assurance is provided by the fact that, if one transaction of a given type
passes a test, then all transactions containing the identical test characteristics will—if
8-9
the appropriate control features are functioning—pass the same test. Accordingly,
the volume of test transactions of a given type is not important.
d. To obtain assurance about this matter, the CPAs should consider the client's general controls
over IT operations, especially those related to the approval of changes in computer programs.
The auditors may also observe the processing of data by the client. If the general control
activities are weak the auditors might consider requesting the program on a surprise basis
from the librarian and using it to process test data.
The CPAs may also request on a surprise basis that the program be left in the computer
at the completion of processing so that they may use it to process test data. This procedure
may reveal computer operator intervention as well as assuring that a current version of the
program is being tested. This is an especially important consideration in newly organized IT
systems undergoing many program changes.
8–35 SOLUTION: Norton Corporation (Estimated time: 25 minutes)
a. Whenever workstations are used for processing financial data, it is important that internal
controls be established to help ensure the reliability of financial data.
b. Controls that should be established for the workstation include the following (five required):
• Programs and operating procedures should be fully documented.

• The computer operator should be well trained.
• Segregation of duties should be established to insure that the operator is not in a position
to perpetrate errors or irregularities and prevent their detection.
• Critical software should be locked away after business hours.
• The computer's operating system should provide a log of workstation use that may be
reviewed by an employee that does not operate the computer or authorize transactions.
• Back-up diskettes or tapes of records should be prepared and stored in a secure location.
• A system of authorization or a locking operating switch should be used to prevent
unauthorized use of the workstation.
8–36 SOLUTION: Central Savings and Loan Association (Estimated Time: 25 minutes)
a. The internal controls pertaining to input of information that should be in effect because an
online, real-time IT-based system is employed should include:
(1) A self-checking digit or some other redundant check should be used with every
account number to prevent an entry to a wrong account.
(2) Input validation checks, such as validity tests and limit tests, should be applied to
input data to test their accuracy and reasonableness.
(3) A daily record of all transaction inputs from each input terminal should be produced
as a by-product of the computer processing so as to provide a supplemental record.
(4) A log of input transactions should be maintained at each terminal and reconciled on a
daily basis (at least with respect to daily totals) with the record of transactions by the
terminal maintained by the computer.
(5) Computer personnel should not initiate input to the computer except for testing
purposes so that a proper segregation of duties is maintained. Any testing should be
done after regular processing is completed and should be recorded in the computer
log.
8-10
(6) Consideration should be given to establishing an integrated test facility of dummy

accounts to enable the internal audit staff to include test data with the actual input.
(7) Computer file security should be provided to assure that entries are not made to the
accounts except during normal processing periods.
b. The internal controls that should be in effect pertaining to matters other than information
input are as follows:
(1) Account balances should be printed out or dumped on magnetic tape at regular
intervals to provide for record reconstruction and testing.
(2) Limit tests should be included in the computer program to permit ready identification
of obvious errors or irregularities (e.g., a withdrawal from an account should not
exceed the balance on deposit in the account).
(3) The data control group should review terminal logs.
(4) The internal audit staff should have the responsibility for testing accounts and
transactions.
(5) Account balance printouts and transaction records necessary to reconstruct the
accounts should be maintained in a separate location from the computer file storage
as a precaution against simultaneous destruction.
(6) There should be provision for continued operation to avoid a time loss in case of
computer failure (e.g., each terminal should have mechanical registers in addition to
the computer's electronic registers).
(7) Security should be provided at each terminal to assure that certain operations could
be initiated only by authorized supervisory personnel (e.g., user identification
numbers and passwords).
8–37 SOLUTION: Alexandria Corporation (Estimated time: 40 minutes)
Weakness Recommended Improvement
(1) Computer department functions have not The function of systems analysis and design,
been properly separated. Under existing programming, computer operations and control
procedures, one employee completely should be assigned to different employees. This
controls programming and operations. also should improve efficiency since different
levels of skill are involved.
(2) Records of computer operations have not In order to properly control usage of the
been maintained. computer, a usage log should be kept and
reconciled with running times by the supervisor.
The system also should provide for preparation
of exception reports on the operator's terminal.
These should be removable only by the
supervisor or the control clerk independent of
the computer operators.
(3) Physical control over computer operations is Only operating employees should have access to
not adequate. All computer department the computer room. Programmers' usage should
employees have access to the computer. be limited to program testing and debugging.
(4) System operations have not been adequately The company should maintain up-to-date
documented. No record has been kept of system and program flowcharts, record layouts,
8-11
adaptations made by the programmer or new program listings, and operator instructions. All
programs. changes in the system should be documented.
8-12
(5) Physical control over tape files and system Programs and tape libraries should be carefully
documentation is not adequate. Materials controlled in a separate location. Preferably a
are unguarded and readily available in the librarian who does not have access to the
computer department. Environment control computer should control these materials and
may not be satisfactory. keep a record of usage. The company should
consult with the computer company about
necessary environmental controls.
(6) The company has not made use of Program controls should be used to supplement
programmed controls. existing manual controls. Examples of
programmed controls include data validity tests,
check digits, limit and reasonableness tests,
sequence checks, and error routines for
unmatched items, erroneous data, and violations
of limits.
(7) Insertion of prices on shipping notices by The company's price list should be placed on a
the billing clerk is inefficient and subject to master file in the computer and matched with
error. product numbers on the shipping notices to
obtain appropriate prices.
(8) Manual accounting for the numerical The computer should be programmed to review
sequence of shipping notices is inefficient. the numerical sequence of shipping notices and
list missing notices.
(9) Control over computer input is not effective. The billing clerk (or other designated control
The computer operator has been given clerk) should retain the control tapes and
responsibility for verifying agreement of compare them to the daily sales register. This
output with the control tapes. This is not an independent test should be supplemented by
independent verification. programming the computer to check control
totals and print exception reports where
appropriate.
(10) The billing clerk should not maintain If receivable records are to be maintained
accounts receivable detail records. manually, a receivable clerk who is independent
of billing and cash collections should be
designated. If the computer department updates
the records, as recommended below, there still
should be an independent review by the general
accounting department.
(11) Accounts receivable records are maintained These records could be maintained more
manually in an open invoice file. efficiently on magnetic disk.
(12) The billing clerk should not receive or mail Copies of invoices should be forwarded by the
invoices. computer department to the customer (or to the
mailroom) and distributed to other recipients in
accordance with established procedures.
(13) Maintaining a chronological file of invoices This file's purpose may be fulfilled by the daily
appears to be unnecessary. sales register.
(14) Sending duplicate copies of invoices to the The computer can be programmed to print a
8-13
warehouse is inefficient. daily listing of invoices applicable to individual

warehouses. This will eliminate the sorting of
invoices.
In-Class Team Case
8–38 SOLUTION: Jenz Corporation (Estimated time: 45 minutes)
(1) M. Perform customer credit check—Customer credit file is being accessed, making it likely
that a credit check is occurring.
(2) Z. Open order file—Processing to the right of #2 begins with "open orders," making this an
open order file.
(3) L. Match customer purchase order with sales order—Two copies of the sales order are being
combined with the customer purchase order through a manual operation (the trapezoid).
(4) B. Verify agreement of sales order and shipping document—Manual operation includes two
copies of the shipping document being combined with the sales order.
(5) H. Release goods for shipment—Department is the warehouse and shipping department, and
out of this operation is "shipping information," accordingly goods are being released for
shipment.
(6) S. Master price file—The operation below #6 include entering price data; since the first two
files being accessed are the accounts receivable master file and the shipping file, this third file
must include prices.
(7) O. Prepare sales invoice—Since a document is being prepared through this computerized
billing program, it is the sales invoice.
(8) U. Sales invoice—A sales invoice is normally sent to the customer.
(9) I. To accounts receivable department—Copy of the sale invoice informs accounts receivable
that the sale has been processed and shipped.
(10) Q. General ledge master file—Because the processing step below includes updating of
master files, this is the general ledge master file.
(11) N. Prepare sales journal—Sales transactions are being processed; therefore, a sales journal is
prepared.
(12) T. Sales Journal—A sales journal was prepared; the accounting department will receive the
sales journal.
(13) Y. Aged trial balance—An aged trial balance is prepared; the credit department will receive
such a report.
8-14
Another random document with
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If a civil officer should, under the pending amendment, attempt to
quell a riot by calling on the bystanders, if they have arms, he is
punishable for that. If a marshal, the marshal of the district in which
the election occurs, the marshal nominated to the Senate and
confirmed by the Senate—I do not mean a deputy marshal—should
see an affray or a riot at the polls on election day and call upon the
bystanders to quell it, if this bill becomes a law, and one of those
bystanders has a revolver in his pocket, or another one takes a stick
or a cudgel in his hand, the marshal may be fined $5,000 and
punished by five years’ imprisonment.
Such are the devices to belittle national authority and national law,
to turn the idea of the sovereignty of the nation into a laughing-stock
and a by-word.
Under what pretexts is this uprooting and overturning to be? Any
officer who transgresses the law, be he civil or military, may be
punished in the courts of the State or in the courts of the nation
under existing law. Is the election act unconstitutional? The courts
for ten years have been open to that question. The law has been
pounded with all the hammers of the lawyers, but it has stood the
test; no court has pronounced it unconstitutional, although many
men have been prosecuted and convicted under it. Judge Woodruff
and Judge Blatchford have vindicated its constitutionality. But, as I
said before, the constitutional argument has been abandoned. The
supreme political court, practically now above Congresses or even
constitutions, the democratic caucus, has decided that the law is
constitutional. The record of the judgment is in the legislative bill.
We are told it costs money to enforce the law. Yes, it costs money
to enforce all laws; it costs money to prosecute smugglers,
counterfeiters, murderers, mail robbers and others. We have been
informed that it has cost $200,000 to execute the election act. It cost
more than $5,000,000,000 in money alone, to preserve our
institutions and our laws, in one war, and the nation which bled and
the nation which paid is not likely to give up its institutions and the
birthright of its citizens for $200,000. [Applause in the galleries.]
The presiding officer, (Mr. Cockrell, in the chair.) The Senator
will suspend a moment. The chair will announce to the galleries that
there shall be no more applause; if so, the galleries will be cleared
immediately.
Mr. Conkling. Mr. President, that interruption reminds me, the
present occupant of the chair having been deeply interested in the
bill, that the appropriations made and squandered for local and
unlawful improvements in the last river and harbor bill alone, would
pay for executing the election law as long as grass grows or water
runs. The interest on the money wrongfully squandered in that one
bill, would execute it twice over perpetually. The cost of this needless
extra session, brought about as a partisan contrivance, would execute
the election law for a great while. A better way to save the cost, than
to repeal the law, is to obey it. Let White Leagues and rifle clubs
disband; let your night-riders dismount; let your tissue ballot-box
stuffers desist; let repeaters, false-counters, and ruffians no longer be
employed to carry elections, and then the cost of executing the law
will disappear from the public ledger.
Again we are told that forty-five million people are in danger from
an army nominally of twenty-five thousand men scattered over a
continent, most of them beyond the frontiers of civilized abode.
Military power has become an affrighting specter. Soldiers at the
polls are displeasing to a political party. What party? That party
whose Administration ordered soldiers, who obeyed, to shoot down
and kill unoffending citizens here in the streets of Washington on
election day; that party which has arrested and dispersed
Legislatures at the point of the bayonet; that party which has
employed troops to carry elections to decide that a State should be
slave and should not be free; that party which has corraled courts of
justice with national bayonets, and hunted panting fugitive slaves, in
peaceful communities, with artillery and dragoons; that party which
would have to-day no majority in either House of Congress except for
elections dominated and decided by violence and fraud; that party
under whose sway, in several States, not only the right to vote, but
the right to be, is now trampled under foot.
Such is the source of an insulting summons to the Executive to
become particeps criminis in prostrating wholesome laws, and this
is the condition on which the money of the people, paid by the
people, shall be permitted to be used for the purposes for which the
people paid it.
Has the present national Administration been officiously robust in
checking the encroachments and turbulence of democrats, either by
the use of troops or otherwise? I ask this question because the next
election is to occur during the term of the present Administration.
What is the need of revolutionary measures now? What is all this
uproar and commotion, this daring venture of partisan experiment,
for? Why not make your issue against these laws, and carry your
issue to the people? If you can elect a President and a Congress of
your thinking, you will have it all your own way.
Why now should there be an attempt to block the wheels of
government on the eve of an election at which this whole question is
triable before the principals and masters of us all? The answer is
inevitable. But one truthful explanation can be made of this daring
enterprise. It is a political, a partisan manœuvre. It is a strike for
party advantage. With a fair election and an honest count, the
democratic party cannot carry the country. These laws, if executed,
insure some approach to a fair election. Therefore they stand in the
way, and therefore they are to be broken down.
I reflect upon no man’s motives, but I believe that the sentiment
which finds expression in the transaction now proceeding in the two
houses of Congress, has its origin in the idea I have stated. I believe
that the managers and charioteers of the democratic party think that
with a fair election and a fair count they cannot carry the State of
New York. They know that with free course, such as existed in 1868,
to the ballot-box and count, no matter what majority may be given in
that State where the green grass grows, the great cities will
overbalance and swamp it. They know that with the ability to give
eighty, ninety, one hundred thousand majority in the county of New
York and the county of Kings, half of it fraudulently added, it is idle
for the three million people living above the Highlands of the
Hudson to vote.
This is a struggle for power. It is a fight for empire. It is a
contrivance to clutch the National Government. That we believe; that
I believe.
The nation has tasted, and drunk to the dregs, the sway of the
democratic party, organized and dominated by the same influences
which dominate it again and still. You want to restore that dominion.
We mean to resist you at every step and by every lawful means that
opportunity places in our hands. We believe that it is good for the
country, good for every man North and South who loves the country
now, that the Government should remain in the hands of those who
were never against it. We believe that it is not wise or safe to give
over our nationality to the dominion of the forces which formerly
and now again rule the democratic party. We do not mean to connive
at further conquests, and we tell you that if you gain further political
power, you must gain it by fair means, and not by foul. We believe
that these laws are wholesome. We believe that they are necessary
barriers against wrongs, necessary defenses for rights; and so
believing, we will keep and defend them even to the uttermost of
lawful honest effort.
The other day, it was Tuesday I think, it pleased the honorable
Senator from Illinois [Mr. Davis] to deliver to the Senate an address,
I had rather said an opinion, able and carefully prepared. That
honorable Senator knows well the regard not only, but the sincere
respect in which I hold him, and he will not misunderstand the
freedom with which I shall refer to some of his utterances.
Whatever else his sayings fail to prove, they did I think, prove their
author, after Mrs. Winslow, the most copious and inexhaustible
fountain of soothing syrup. The honorable Senator seemed like one
slumbering in a storm and dreaming of a calm. He said there was no
uproar anywhere—one would infer you could hear a pin drop—from
centre to circumference. Rights, he said, are secure. I have his
language here. If I do not seem to give the substance aright I will stop
and read it. Rights secure North and South; peace and tranquillity
everywhere. The law obeyed and no need of special provisions or
anxiety. It was in this strain that the Senator discoursed.
Are rights secure, when fresh-done barbarities show that local
government in one portion of our land is no better than despotism
tempered by assassination? Rights secure, when such things can be,
as stand proved and recorded by committees of the Senate! Rights
secure, when the old and the young fly in terror from their homes,
and from the graves of their murdered dead! Rights secure, when
thousands brave cold, hunger, death, seeking among strangers in a
far country a humanity which will remember that—
“Before man made them citizens,
Great nature made them men!”
Read the memorial signed by Judge Dillon, by the democratic
mayor of Saint Louis, by Mr. Henderson, once a member of the
Senate, and by other men known to the nation, detailing what has
been done in recent weeks on the Southern Mississippi. Read the
affidavits accompanying this memorial. Has any one a copy of the
memorial here? I have seen the memorial. I have seen the signatures.
I hope the honorable Senator from Illinois will read it, and read the
affidavits which accompany it. When he does, he will read one of the
most sickening recitals of modern times. He will look upon one of the
bloodiest and blackest pictures in the book of recent years. Yet the
Senator says, all is quiet. “There is not such faith, no not in Israel.”
Verily “order reigns in Warsaw.”
Solitudinem faciunt, pacem appellant.
Mr. President, the republican party every where wants peace and
prosperity—peace and prosperity in the South, as much and as
sincerely as elsewhere. Disguising the truth, will not bring peace and
prosperity. Soft phrases will not bring peace. “Fair words butter no
parsnips.” We hear a great deal of loose, flabby talk about “fanning
dying embers,” “rekindling smoldering fires,” and so on. Whenever
the plain truth is spoken, these unctious monitions, with a Peter
Parley benevolence, fall copiously upon us. This lullaby and hush has
been in my belief a mistake from the beginning. It has misled the
South and misled the North. In Andrew Johnson’s time a convention
was worked up at Philadelphia, and men were brought from the
North and South, for ecstasy and gush. A man from Massachusetts
and a man from South Carolina locked arms and walked into the
convention arm in arm, and sensation and credulity palpitated, and
clapped their hands, and thought an universal solvent had been
found. Serenades were held at which “Dixie” was played. Later on,
anniversaries of battles fought in the war of Independence, were
made occasions by men from the North and men from the South for
emotional, dramatic, hugging ceremonies. General Sherman, I
remember, attended one of them, and I remember also, that with the
bluntness of a soldier, and the wisdom and hard sense of a
statesman, he plainly cautioned all concerned not to be carried away,
and not to be fooled. But many have been fooled, and being fooled,
have helped to swell the democratic majorities which now display
themselves before the public eye.
Of all such effusive demonstrations I have this to say: honest,
serious convictions are not ecstatic or emotional. Grave affairs and
lasting purposes do not express or vent themselves in honeyed
phrase or sickly sentimentality, rhapsody, or profuse professions.
This is as true of political as of religious duties. The Divine Master
tells us, “Not every one that saith unto me, Lord, Lord, shall enter
into the kingdom of heaven; but he that doeth the will of my Father
which is in heaven.”
Facts are stubborn things, but the better way to deal with them is
to look them squarely in the face.
The republican party and the Northern people preach no crusade
against the South. I will say nothing of the past beyond a single fact.
When the war was over, no man who fought against his flag was
punished even by imprisonment. No estate was confiscated. Every
man was left free to enjoy life, liberty, and the pursuit of happiness.
After the Southern States were restored to their relations in the
Union, no man was ever disfranchised by national authority—not
one. If this statement is denied, I invite any Senator to correct me. I
repeat it. After the Southern State governments were rebuilded, and
the States were restored to their relations in the Union, by national
authority, not one man for one moment was ever denied the right to
vote, or hindered in the right. From the time that Mississippi was
restored, there never has been an hour when Jefferson Davis might
not vote as freely as the honorable Senator in his State of Illinois. The
North, burdened with taxes, draped in mourning, dotted over with
new-made graves tenanted by her bravest and her best, sought to
inflict no penalty upon those who had stricken her with the greatest,
and, as she believed, the guiltiest rebellion that ever crimsoned the
annals of the human race.
As an example of generosity and magnanimity, the conduct of the
nation in victory was the grandest the world has ever seen. The same
spirit prevails now. Yet our ears are larumed with the charge that the
republicans of the North seek to revive and intensify the wounds and
pangs and passions of the war, and that the southern democrats seek
to bury them in oblivion of kind forgetfulness.
We can test the truth of these assertions right before our eyes. Let
us test them. Twenty-seven States adhered to the Union in the dark
hour. Those States send to Congress two hundred and sixty-nine
Senators and Representatives. Of these two hundred and sixty-nine
Senators and Representatives, fifty-four, and only fifty-four, were
soldiers in the armies of the Union. The eleven States which were
disloyal send ninety-three Senators and Representatives to Congress.
Of these, eighty-five were soldiers in the armies of the rebellion, and
at least three more held high civil station in the rebellion, making in
all eighty-eight out of ninety-three.
Let me state the same fact, dividing the Houses. There are but four
Senators here who fought in the Union Army. They all sit here now;
and there are but four. Twenty Senators sit here who fought in the
army of the rebellion, and three more Senators sit here who held
high civil command in the confederacy.
In the House, there are fifty Union soldiers from twenty-seven
States, and sixty-five confederate soldiers from eleven States.
Who, I ask you, Senators, tried by this record, is keeping up party
divisions on the issues and hatreds of the war?
The South is solid. Throughout all its borders it has no seat here
save two in which a republican sits. The Senator from Mississippi
[Mr. Bruce] and the Senator from Louisiana [Mr. Kellogg] are still
spared; and whisper says that an enterprise is afoot to deprive one of
these Senators of his seat. The South is emphatically solid. Can you
wonder that the North soon becomes solid too? Do you not see that
the doings witnessed now in Congress fill the North with alarm, and
distrust of the patriotism and good faith of men from the South?
Forty-two democrats have seats on this floor; forty-three if you add
the honorable Senator from Illinois, [Mr. Davis.] He does not belong
to the democratic party, although I must say, after reading his speech
the other day, that a democrat who asks anything more of him is an
insatiate monster. [Laughter.] If we count the Senator from Illinois,
there are forty-three democrats in this Chamber. Twenty-three is a
clear majority of all, and twenty-three happens to be exactly the
number of Senators from the South who were leaders in the late
rebellion.
Do you anticipate my object in stating these numbers? For fear you
do not, let me explain. Forty-two Senators rule the Senate; twenty-
three Senators rule the caucus. A majority rules the Senate; a caucus
rules the majority; and the twenty-three southern Senators rule the
caucus. The same thing, in the same way, governed by the same
elements, is true in the House.
This present assault upon the purity and fairness of elections,
upon the Constitution, upon the executive department, and upon the
rights of the people; not the rights of a king, not on such rights as we
heard the distinguished presiding officer, who I am glad now to
discover in his seat, dilate upon of a morning some weeks ago; not
the divine right of kings, but the inborn rights of the people—the
present assault upon them, could never have been inaugurated
without the action of the twenty-three southern Senators here, and
the southern Representatives there, [pointing to the House.]
The people of the North know this and see it. They see the lead and
control of the democratic party again where it was before the war, in
the hands of the South. “By their fruits ye shall know them.” The
honorable Senator from Alabama [Mr. Morgan], educated no doubt
by experience in political appearances, and spectacular effects, said
the other day that he preferred the democrats from the North should
go first in this debate. I admired his sagacity. It was the skill of an
experienced tactician to deploy the northern levies as the sappers
and miners; it was very becoming certainly. It was not from cruelty,
or to make them food for powder, that he set them in the forefront of
the battle; he thought it would appear better for the northern
auxiliaries to go first and tunnel the citadel. Good, excellent, as far as
it went; but it did not go very far in misleading anybody; putting the
tail foremost and the head in the sand, only displayed the species and
habits of the bird. [Laughter.]
We heard the other day that “the logic of events” had filled the
southern seats here with men banded together by a common history
and a common purpose. The Senator who made that sage
observation perhaps builded better than he knew. The same logic of
events, let me tell democratic Senators, and the communities behind
them, is destined to bring from the North more united delegations.
I read in a newspaper that it was proposed the other day in
another place, to restore to the Army of the United States men who,
educated at the nation’s cost and presented with the nation’s sword,
drew the sword against the nation’s life. In the pending bill is a
provision for the retirement of officers now in the Army, with
advanced rank and exaggerated pay. This may be harmless, it may be
kind. One swallow proves not spring, but along with other things,
suspicion will see in it an attempt to coax officers now in the Army to
dismount, to empty their saddles, in order that others may get on.
So hue and cry is raised because courts, on motion, for cause
shown in open court, have a right to purge juries in certain cases. No
man in all the South, under thirty-five years of age, can be affected by
this provision, because every such man was too young when the
armies of the rebellion were recruited to be subject to the provision
complained of. As to the rest, the discretion is a wholesome one. But,
even if it were not, let me say in all kindness to southern Senators, it
was not wise to make it a part of this proceeding, and raise this
uproar in regard to it.
Even the purpose, in part already executed, to remove the old and
faithful officers of the Senate, even Union soldiers, that their places
may be snatched by others—to overturn an order of the Senate which
has existed for a quarter of a century, in order to grasp all the petty
places here, seems to me unwise. It is not wise, if you want to disarm
suspicion that you mean aggrandizing, gormandizing, unreasonable
things.
Viewing all these doings in the light of party advantage—advantage
to the party to which I belong, I could not deplore them; far from it;
but wishing the repose of the country, and the real, lasting, ultimate
welfare of the South, and wishing it from the bottom of my heart, I
believe they are flagrantly unwise, hurtfully injudicious.
What the South needs is to heal, build, mend, plant, sow. In short,
to go to work. Invite labor; cherish it; do not drive it out. Quit
proscription, both for opinion’s sake, and for color’s sake. Reform it
altogether. I know there are difficulties in the way. I know there is
natural repugnance in the way; but drop passion, drop sentiment
which signifies naught, and let the material prosperity and
civilization of your land advance. Do not give so much energy, so
much restless, sleepless activity, to an attempt so soon to get
possession once more, and dominate and rule the country. There is
room enough at the national board, and it is not needed, it is not
decorous, plainly speaking, that the South should be the MacGregor
at the table, and that the head of the table should be wherever he sits.
For a good many reasons, it is not worth while to insist upon it.
Mr. President, one of Rome’s famous legends stands in these
words: “Let what each man thinks of the Republic be written on his
brow.” I have spoken in the spirit of this injunction. Meaning offence
to no man, and holding ill-will to no man, because he comes from the
South, or because he differs with me in political opinion, I have
spoken frankly, but with malice toward none.
This session, and the bill pending, are acts in a partisan and
political enterprise. This debate, begun after a caucus had defined
and clenched the position of every man in the majority, has not been
waged to convince anybody here. It has resounded to fire the
democratic heart, to sound a blast to the cohorts of party, to beat the
long-roll, and set the squadrons in the field. That is its object, as
plainly to be seen as the ultimate object of the attempted overthrow
of laws.
Political speeches having been thus ordained, I have discussed
political themes, and with ill-will to no portion of the country but
good will toward every portion of it, I have with candor spoken
somewhat of my thoughts of the duties and dangers of the hour.
[Applause on the floor and in the galleries.]
Lincoln’s Speech at Gettysburg.
“Four-score and seven years ago, our fathers brought forth on this
continent, a new Nation, conceived in liberty, and dedicated to the
proposition that all men are created equal.
“Now, we are engaged in a great civil war testing whether that
Nation, or any Nation, so conceived and so dedicated, can long
endure. We are met on a great battle-field of that war. We have come
to dedicate a portion of that field, as a final resting-place for those,
who here gave their lives that that Nation might live. It is altogether
fitting and proper that we should do this.
“But, in a large sense, we cannot dedicate—we cannot consecrate—
we cannot hallow this ground. The brave men, living and dead, who
struggled here, have consecrated it far above our poor power to add
or detract. The world will little note, nor long remember what we SAY
here, but it can never forget what they DID here. It is for us the living,
rather, to be dedicated here to the unfinished work which they who
fought here have thus far so nobly advanced. It is rather for us to be
here dedicated to the great task remaining before us, that from these
honored dead, we take increased devotion to that cause for which
they gave the last full measure of devotion, that we here highly
resolve that these dead shall not have died in vain; that this Nation,
under God, shall have a new birth of freedom; and that Government
of the people, by the people, and for the people shall not perish from
this earth.”
Speech of Hon. John M. Broomall, of
Pennsylvania,
On the Civil Rights Bill. House of Representatives, March 8, 1866.

Mr. Speaker, it is alleged that this species of legislation will widen
the breach existing between the two sections of the country, will
offend our southern brethren. Do not gentlemen know that those
who are most earnestly asking this legislation are our southern
brethren themselves.
They are imploring us to protect them against the conquered
enemies of the country, who notwithstanding their surrender, have
managed, through their skill or our weakness, to seize nearly all the
conquered territory.
This is not the first instance in the world’s history in which all that
had been gained by hard fighting was lost by bad diplomacy.
But they, whose feelings are entitled to so much consideration in
the estimation of those who urge this argument, are not our southern
brethren, but the southern brethren of our political opponents; the
conquered rebels, pardoned and unpardoned; traitors priding
themselves upon their treason.
These people are fastidious. The ordinary terms of the English
language must be perverted to suit their tastes. Though they
surrendered in open and public war, they are not to be treated as
prisoners. Though beaten in the last ditch of the last fortification,
they are not to be called a conquered people. The decision of the
forum of their own choosing is to be explained away into
meaningless formality for their benefit. Though guilty of treason,
murder, arson, and all the crimes in the calendar, they are “our
southern brethren.” The entire decalogue must be suspended lest it
should offend these polished candidates for the contempt and
execration of posterity.
Out of deference to the feelings of these sensitive gentlemen, an
executive construction must be given to the word “loyalty,” so that it
shall embrace men who only are not hanged because they have been
pardoned, and who only did not destroy the Government because
they could not. Out of deference to the feelings of these sensitive
gentlemen, too, a distinguished public functionary, once the
champion of the rights of man, a leader in the cause of human
progress, a statesman whose keen foreknowledge could point out the
“irrepressible conflict between slavery and freedom,” cannot now see
that treason and loyalty are uncompromising antagonisms.
It is charged against us that the wheels of Government are stopped
by our refusal to admit the representatives of these southern
communities. When we complain that Europe is underselling us in
our markets, and demand protection for the American laborer, we
are told to “admit the southern Senators and Representatives.” When
we complain that excessive importations are impoverishing the
country, and rapidly bringing on financial ruin, we are told to “admit
the southern Senators and Representatives.” When we complain that
an inflated currency is making the rich richer, and the poor poorer,
keeping the prices of even the necessaries of life beyond the reach of
widows and orphans who are living upon fixed incomes, the
stereotyped answer comes, “Admit the southern Senators and
Representatives.” When we demand a tax upon cotton to defray the
enormous outlay made in dethroning that usurping “king of the
world,” still the answer comes, and the executive parrots everywhere
repeat it, “Admit the southern Senators and Representatives.”
The mind of the man who can see in that prescription a remedy for
all political and social diseases must be curiously constituted. Would
these Senators and Representatives vote a tax upon cotton? Would
they protect American industry by increasing duties? Would they
prevent excessive importations? To believe this requires as
unquestioning a faith as to believe in the sudden conversion of whole
communities from treason to loyalty.
We are blocking the wheels of Government! Why, the Government
has managed to get along for four years, not only without the aid of
the Southern Senators and Representatives, but against their efforts
to destroy it; and in the mean time has crushed a rebellion that
would have destroyed any other Government under heaven. Surely
the nation can do without the services of these men, at least during
the time required to examine their claims and to protect by
appropriate legislation our Southern brethren. None but a Democrat
would think of consulting the wolf about what safeguard should be
thrown around the flock.
Those who advocate the admission of the Senators and
Representatives from the States lately reclaimed from the rebellion,
as a means of protecting the loyal men in those States and as a
substitute for the system of legislation of which this bill is part, well
know that the majority in both Houses of Congress ardently desire
the full recognition of those States, and only ask that the rights and
interests of the truly loyal men in those States shall be first
satisfactorily secured.
Much useless controversy has been had about the legal status of
those States. There is no difference between the two parties of the
country on that point. The actual point of difference is this: the
Democrats affiliate with their old political friends in the South, the
late rebels, the friends and followers of Breckinridge, Lee, and Davis.
The Union majority, on the other hand, naturally affiliate with the
loyal men in the South, the men who have always supported the
Government against Breckinridge, Lee, and Davis. Each party wants
the South reconstructed in the hands of its own “southern brethren.”
In short, the northern party corresponding with the loyal men of
the South ask that the legitimate results of Grant’s victory shall be
carried out, while the northern party corresponding with the rebels
of the South ask that things should be considered as if Lee had been
the conqueror, or at least as if there had been a drawn battle, without
victory on either side.
This brings the rights of those in whose behalf the opponents of
the bill under consideration are acting directly in question, and in
order to limit down the field of controversy as far as possible, let us
inquire how far all parties agree upon the legal status of the
communities lately in rebellion. Now, the meanest of all
controversies is that which comes from dialectics. Where the
disputants attach different meanings to the same word their time is
worse than thrown away. I have always looked upon the question
whether the States are in or out of the Union as only worthy of the
schoolmen of the middle ages, who could write volumes upon a mere
verbal quibble. The disputants would agree if they were compelled to
use the word “State” in the same sense. I will endeavor to avoid this
trifling.
All parties agree that at the close of the rebellion the people of
North Carolina, for example, had been “deprived of all civil
government.” The President, in his proclamation of May 29, 1865,
tells the people of North Carolina this in so many words, and he tells
the people of the other rebel States the same thing in his several
proclamations to them. This includes the Conservatives and
Democrats, who, however they may disagree, at last agree in this,
that the President shall do their thinking.
The Republicans subscribe to this doctrine, though they differ in
their modes of expressing it. Some say that those States have ceased
to possess any of the rights and powers of government as States of
the Union. Others say, with the late lamented President, that “those
States are out of practical relations with the Government.”
Others hold that the State organizations are out of the Union. And
still others that the rebels are conquered, and therefore that their
organizations are at the will of the conqueror.
The President has hit upon a mode of expression which embraces
concisely all these ideas. He says that the people of those States were,
by the progress of the rebellion and by its termination, “deprived of
all civil government.”
One step further. All parties agree that the people of these States,
being thus disorganized for all State purposes, are still at the election
of the government, citizens of the United States, and as such, as far
as they have not been disqualified by treason, ought to be allowed to
form their own State governments, subject to the requirements of the
Constitution of the United States.
Still one step further. All parties agree that this cannot be done by
mere unauthorized congregations of the people, but that the time,
place and manner must be prescribed by some department of the
Government, according to the argument of Mr. Webster and the
spirit of the decision of the Supreme Court in Luther vs. Borden, 7
Howard, page 1.
Yet another step in the series of propositions. All parties agree that
as Congress was not in session at the close of the rebellion, the
President, as Commander-in-Chief, was bound to take possession of
the conquered country and establish such government as was
necessary.
Thus far all is harmonious; but now the divergence begins. At the
commencement of the present session of Congress three-fourths of
both Houses held that when the people of the States are “deprived of
all civil government,” and when, therefore, it becomes necessary to
prescribe the time, place, and manner in and by which they shall
organize themselves again into States while the President may take
temporary measures, yet only the law-making power of the
Government is competent to the full accomplishment of the task. In
other words, that only Congress can enable citizens of the United
States to create States. I have said that at the commencement of the
session three-fourths of both houses held this opinion. The
proportion is smaller now, and by a judicious use of executive
patronage it may become still smaller; but the truth of the
proposition will not be affected if every Representative and Senator
should be manipulated into denying it.
On the other hand, the remaining fourth, composed of the supple
Democracy and its accessions, maintain that this State-creating
power is vested in the President alone, and that he has already
exercised it.
The holy horror with which our opponents affect to contemplate
the doctrine of destruction of States is that much political hypocrisy.
Every man who asks the recognition of the existing local
governments in the South thereby commits himself to that doctrine.
The only possible claim that can be set up in favor of the existing
governments is based upon the theory that the old ones have been
destroyed. The present organizations sprang up at the bidding of the
President after the conquest among a people who, he said, had been
“deprived of all civil government.”
If the President’s “experiment” had resulted in organizing the
southern communities in loyal hands, the majority in Congress
would have found no difficulty in indorsing it and giving it the
necessary efficiency by legislative enactment.
In this case, too, the President never would have denied the power
of Congress in the premises. He never would have set up the theory
that the citizens of the United States, through their representatives,
are not to be consulted when those who have once broken faith with
them ask to have the compact renewed.
Our opponents have no love for the President. They called him a
usurper and a tyrant in Tennessee. They ridiculed him as a negro
“Moses.” They tried to kill him, and failing that, they accused him of
being privy to the murder of his predecessor. But when his
“experiment” at reconstruction was found to result in favor of their
friends, the rebels, then they hung themselves about his neck like so
many mill-stones, and tried to damn him to eternal infamy by
indorsing his policy. Will they succeed? Will he shake them off, or go
down with them?
But let us suffer these discordant elements to settle their own
terms of combinations as best they may. The final result cannot be
doubtful.
If ten righteous men were needed to save Sodom, even Andrew
Johnson will find it impossible to save the Democratic party.
Our path of duty is plain before us. Let us pass this bill and such
others as may be necessary to secure protection to the loyal men of
the South. If our political opponents thwart our purposes in this, let
us go to the country upon that issue.
I am by no means an advocate of extensive punishment, either in
the way of hanging or confiscation, though some of both might be
salutary. I do not ask that full retribution be enforced against those
who have so grievously sinned. I am willing to make forgiveness the
rule and punishment the exception; yet I have my ultimatum. I
might excuse the pardon of the traitors Lee and Davis, even after the
hanging of Wirz, who but obeyed their orders, orders which he would
have been shot for disobeying. I might excuse the sparing of the
master after killing the dog whose bite but carried with it the venom
engendered in the master’s soul. I might look calmly upon a
constituency ground down by taxation, and tell the complainants
that they have neither remedy nor hope of vengeance upon the
authors of their wrongs. I might agree to turn unpityingly from the
mother whose son fell in the Wilderness, and the widow whose
husband was starved at Andersonville, and tell them that in the
nature of things retributive justice is denied them, and that the
murderers of their kindred may yet sit in the councils of their
country; yet even I have my ultimatum. I might consent that the
glorious deeds of the last five years should be blotted from the
country’s history; that the trophies won on a hundred battle-fields,
the sublime visible evidence of the heroic devotion of America’s
citizen soldiery, should be burned on the altar of reconciliation. I
might consent that the cemetery at Gettysburg should be razed to the
ground; that its soil should be submitted to the plow, and that the
lamentation of the bereaved should give place to the lowing of cattle.
But there is a point beyond which I shall neither be forced nor
persuaded. I will never consent that the government shall desert its
allies in the South and surrender their rights and interests to the
enemy, and in this I will make no distinction of caste or color either
among friends or foes.
The people of the South were not all traitors. Among them were
knees that never bowed to the Baal of secession, lips that never
kissed his image. Among the fastness of the mountains, in the rural
districts, far from the contagion of political centres, the fires of
patriotism still burned, sometimes in the higher walks of life, oftener
in obscure hamlets, and still oftener under skins as black as the
hearts of those who claimed to own them.
These people devoted all they had to their country. The homes of
some have been confiscated, and they are now fugitives from the
scenes that gladdened their childhood. Some were cast into
dungeons for refusing to fire upon their country’s flag, and still
others bear the marks of stripes inflicted for giving bread and water
to the weary soldier of the Republic, and aiding the fugitive to escape
the penalty of the disloyalty to treason. If the God of nations listened
to the prayers that ascended from so many altars during those
eventful years, it was to the prayers of these people.
Sir, we talked of patriotism in our happy northern homes, and
claimed credit for the part we acted; but if the history of these people
shall ever be written, it will make us blush that we ever professed to
love our country.
The government now stands guard over the lives and fortunes of
these people. They are imploring us not to yield them up without
condition to those into whose hands recent events have committed
the destinies of the unfortunate South. A nation which could thus
withdraw its protection from such allies, at such a time, without their
full and free consent, could neither hope for the approval of mankind
nor the blessing of heaven.
Speech, of Hon. Charles A. Eldridge, of
Wisconsin.
Against the Civil Rights Bill, in the House of Representatives, March

2, 1866.
Mr. Speaker: I thought yesterday that I would discuss this measure
at some length; but I find myself this morning very unwell; and I
shall therefore make only a few remarks, suggesting some objections
to the bill.
I look upon the bill before us, Mr. Speaker, as one of the series of
measures rising out of a feeling of distrust and hatred on the part of
certain individuals, not only in this House, but throughout the
country, toward these persons who formerly held slaves. I had hoped
that long before this time the people of this country would have come
to the conclusion that the subject of slavery and the questions
connected with it had already sufficiently agitated this country. I had
hoped that now, when the war is over, when peace has been restored,
when in every State of the Union the institution of slavery has been
freely given up, its abolition acquiesced in, and the Constitution of
the United States amended in accordance with that idea, this subject
would cease to haunt us as it is made to do in the various measures
which are constantly being here introduced.
This bill is, it appears to me, one of the most insidious and
dangerous of the various measures which have been directed against
the interest of the people of this country. It is another of the
measures designed to take away the essential rights of the State. I
know that when I speak of States and State rights, I enter upon
unpopular subjects. But, sir, whatever other gentlemen may think, I
hold that the rights of the States are the rights of the Union, that the
rights of the States and the liberty of the States are essential to the
liberty of the individual citizen. * * *

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Consideration of Internal Control

8–14 Data transmission controls include (only three required):

Questions Requiring Analysis

8–29 Multiple Choice Questions

i. (2) When deciding whether to engage an information technology specialist, it is doubtful

8–30 a. False f. False

8–33 SOLUTION: Ultimate Life Insurance Company (Estimated time: 25 minutes)

8–34 SOLUTION: IT Auditing Approaches (Estimated time: 30 minutes)

8–35 SOLUTION: Norton Corporation (Estimated time: 25 minutes)

• Programs and operating procedures should be fully documented.

(6) Consideration should be given to establishing an integrated test facility of dummy

8–37 SOLUTION: Alexandria Corporation (Estimated time: 40 minutes)

Weakness Recommended Improvement

warehouse is inefficient. daily listing of invoices applicable to individual

In-Class Team Case

8–38 SOLUTION: Jenz Corporation (Estimated time: 45 minutes)

On the Civil Rights Bill. House of Representatives, March 8, 1866.

Against the Civil Rights Bill, in the House of Representatives, March

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