Segregation of Duties

• Segregation of inventory control from the

warehouse
• Segregation of the general ledger and
accounts payable from cash disbursements

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 SUPERVISION
• Within the expenditure cycle, supervision
is of highest importance in the Receiving
department, where the inventory arrives
and is logged in by a receiving clerk. Need
to minimize:
• failures to properly inspect the assets
• theft of the assets

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 ACCOUNTING RECORDS

• Accounting records rest on the reliability and

security of stored digitalized data.
• Accountants should be skeptical about the accuracy of
hard-copy printouts.
• Backups - the system needs to ensure that backups of all
files are continuously kept
• Most automated systems still have a lot of
paper documents.
• This is good for audit trail purposes but is often
inefficient.
• As the system becomes increasing paperless, maintaining
an audit trail becomes more difficult.
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