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  • Structure
  • Schedule
    • First Half of the Semester
      • Week 1: Introduction
      • Week 2: Business Process; Assertions
      • Week 3: Fraud, P2P Controls
      • Week 4: OTC Process, Types of Controls
      • Week 5: Inventory & Shipping Controls
      • Week 6: Invoicing & Collection Controls
      • Week 7: IT vs. SAP Controls, Security 1
    • Second Half of the Semester
      • Week 8: Security: Roles, Finance Process & Controls
      • Week 9: Security: User Management, Segregation of Duties
      • Week 10: Data, SOD/SAT Review
      • Week 11: Change Management, Development
      • Week 12: Auditing, Table Security, Risk / Control Framework
      • Week 13: SAP Futures, Special System Access (updated Nov 30)
      • Week 14: Character vs. Controls
  • Assignments
    • Exercise 1: Procure to Pay
    • Exercise 2: Order to Cash
    • Exercise 3: Journal Entries
    • Exercise 4: Segregation of Duties (SOD)
    • Final Exercise: Risk-Controls Framework
    • Extra Credit Assignment
  • Roster / Schedule / Teams
  • Webex
  • Gradebook

Auditing Controls in ERP Systems

ERP Systems

Week 03: Fraud, P2P Controls

Week 3 Wrap-up: Fraud, P2P Controls

September 20, 2016 by Edward N Beaver

Great discussion this week.  You raised all the important points but let me share my thoughts.

Q1: ‘Assertions’ are important to who?  You shared many good scenarios and examples.  In my view, assertions are important to anyone who uses information provided by a company.  Whether those relying on the information are inside or outside the company, unless assertions / controls are in place they can’t count on the information.  We’ve talked mostly about financial information, but the veracity of non-financial information also requires assertions / controls.

Q2:  Which dimension of Management Assertions do you believe is the most important?  In my view, all the dimensions are of some value.  The industry and type of business can significantly impact the varying risk associated with each dimension.

Q3: Have you ever been victim of fraud?   Thanks for sharing your own personal and some cases emotional stories.  I hope you agree with me that fraud is real in our world today and adequate controls are necessary  to address the risks.  The fraud triangle is a effective tool for analyzing risk scenarios – especially those of high risk.

Q4: Which step of the P2P is the most vulnerable?  Risks exist in every step of the process.  However, I believe the early and payment steps are the most vulnerable.  The vulnerability exists because the early steps relate to the value of the transaction and the payment step is where the $$ changes hands.  Because of the wide variety of different P2P scenarios, it’s a challenge to identify all the risks and effectively put controls in place to address.

I trust from our discussions in class and these questions, how important assertions and their related controls are.  We’ll be exploring for the remainder of class risks and related controls in various processes and scenarios.

Week 3 Questions

September 13, 2016 by Edward N Beaver 151 Comments

  1. The concept of ‘Assertions’ is important to accountants.  Who else is it important to?  Why?
  2. In class we discussed several dimensions of Management Assertions.  Which do you believe is the most important?  Why?
  3. Have you ever:
    – Been victim of Fraud?
    – Had evidence of, suspicions of fraud occurring?
    – Been pressured (e.g. by an employer) to commit an act that was morally or legally questionable?
     Explain
  4. Which portion / step of the Procure to Pay process do they see as the most vulnerable to theft, fraud or failure of some kind?  Explain

Primary Sidebar

Weekly Discussions

  • Assignments (11)
  • Exams (5)
  • General (6)
  • Real World Control Failure Presentations (27)
  • Week 01: Introduction (4)
  • Week 02: Business Process; Assertions (4)
  • Week 03: Fraud, P2P Controls (2)
  • Week 04: OTC Process, Types of Controls (3)
  • Week 05: Inventory & Shipping Controls (3)
  • Week 06: Invoicing & Collection Controls (1)
  • Week 07: General IT vs. SAP Controls, Security 1 (3)
  • Week 08: Security 2, Finance 2 (2)
  • Week 09: Security: User Mgmt, Segregation of Duties (2)
  • Week 10: Data; SOD/SAT Review (2)
  • Week 11: Change Management, Development (3)
  • Week 12: Table Security, Control Framework (2)
  • Week 13: SAP Futures, Special System Access (2)
  • Week 14: Character vs. Controls (4)

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