Assumes that when conducting procedures to obtain an understanding of the control structure in the Fiona Company, you checked “NO” to the following internal control questionnaire items: Does access to on-line files requires specific passwords to be entered to identify and validate the terminal user?Are control totals established by the user prior to submitting data for processing? (order entry application subsystem).Are input control totals reconciled to output control totals? (Order entry application sub system). Required: Describe the errors, irregularities, or misstatements that could occur due to the weaknesses indicated by the lack of controls.

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Answered: Describe the errors, irregularities, or…

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter3: Internal Control Over Financial Reporting: Responsibilities Of Management And The External Auditor

Section: Chapter Questions

Problem 20CYBK

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Assumes that when conducting procedures to obtain an understanding of the control structure in the Fiona Company, you checked “NO” to the following internal control questionnaire items:

Does access to on-line files requires specific passwords to be entered to identify and validate the terminal user?
Are control totals established by the user prior to submitting data for processing? (order entry application subsystem).
Are input control totals reconciled to output control totals? (Order entry application sub system).

Required:

Describe the errors, irregularities, or misstatements that could occur due to the weaknesses indicated by the lack of controls.

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