Accounting financial systems and auditing Slide bài giảng Kế toán Hệ thống tài chính và kiểm toán

Accounting financial systems and auditing Kế toán Hệ thống tài chính và kiểm toán Accounting financial systems and auditing Slide bài giảng Kế toán Hệ thống tài chính và kiểm toán gồm những nộidung Understand how an accounting system operates Describe the 3 phases involved in the development of accounting systems, and understand the essential characteristics inherent in the system Identify the principles of internal control and understand the limitations of internal control systems

FINANCIAL SYSTEMS AND AUDITING Chapter 1 Accounting systems FINANCIAL SYSTEMS AND AUDITING Chapter 1 Accounting systems Learning Objectives 1. Understand how an accounting system operates 2. Describe the 3 phases involved in the development of accounting systems, and understand the essential characteristics inherent in the system 3. Identify the principles of internal control and understand the limitations of internal control systems Learning Objectives (cont’d) 4. Understand the advantages and disadvantages of computerised accounting systems Lecture References • Hoggett, Edwards & Medlin, 6th edition, Chapter 7 Operation of an Accounting System • Converting data into information Business transactions Reports Interested parties Source documents Journals Ledgers Development of an Accounting System • Systems analysis – Information requirements – Sources of information • Systems design – Consideration of key elements • Systems implementation and review – Parallel operation Development of an Accounting System (cont’d) • Important considerations – Cost vs. benefits – Compatibility – Flexibility/adaptability – Internal control Internal Control Systems • Internal control system defined • Principles of internal control systems – Clearly established lines of responsibility – Division of responsibility for related transactions – Mechanical and electronic devices – Adequate insurance – Internal auditing – Programming controls – Physical controls – Other controls Limitations of Internal Control Systems • Absolute assurance not possible • Effectiveness influenced by size of entity’s operations • Good controls can break down due to tiredness, indifference or carelessness • Reliance on segregation of duties • Difficulties in detecting computer fraud Manual Accounting Systems — Subsidiary Ledgers • Control accounts and subsidiary ledgers – Summary information • Control account – Detailed information • Subsidiary ledger • Accounts receivable • Accounts payable • Inventory [...]... documents and reports • Improved reporting and decision making • Faster response time Computerised Accounting — Disadvantages • • • • • • • • • Failed systems Power failure Viruses Hackers – security checks Fraud High development / purchasing cost for installing the software Need to develop a system of coding and checking Lack of audit trail Possible resistance from the staff Accounting Cycle — Manual and. .. accounts receivable – Debit balances in accounts payable • Account set-offs – Buying and selling from same customer/supplier – Need legal right to set-off Computerised Accounting Systems • Use of computers in business • Manual vs computerised systems – Input – Processing – Output • MYOB • Quickbooks Pro Computerised Accounting Systems (cont’d) Accounts receivable Accounts receivable master file - master file... Credit Balance 1100 1100 2400 2400 Subsidiary Ledger D Cane Date Nov 1 Nov 12 Nov 28 Debit Credit Balance 2600 2200 3100 500 900 Manual Accounting Systems — Special Journals • General journal inefficient where there are many transactions • Group like transactions and record in a special purpose journal – credit sales – credit purchases – cash receipts cash payments sales journal purchases journal cash... Sales journal •• Cash receipts journal Cash receipts journal Accounting Software • Electronic spreadsheets – Excel, Lotus 123 • General ledger programs – ACCPAC, Attache, MYOB, QuickBooks, Sybiz – Data input obtained from source documents – Output produced by the program An Introduction to MYOB An Introduction to QuickBooks Computerised Accounting — Advantages • • • • • Reduction in processing costs... (510) Cash Receipts Journal • • • • Records all receipts of cash Records each receipt and total banked Totals posted to general ledger monthly Detail (debtors only) posted to subsidiary ledger daily • Columns set up for common receipts Cash Payments Journal • • • • Records all payments of cash Records each payment and cheque number Totals posted to general ledger monthly Detail (creditors only) posted... cost for installing the software Need to develop a system of coding and checking Lack of audit trail Possible resistance from the staff Accounting Cycle — Manual and Computerised Steps in Accounting Cycle Steps in Accounting Cycle • • • • • • • • • • • • • • • • • • • • • • • • • • • • Recognise transactions Recognise transactions Journalise transactions Journalise transactions Post ledger accounts... Prepare adjusted TB Prepare adjusted TB Journalise closing entries Journalise closing entries Post closing entries Post closing entries Prepare post closing TB Prepare post closing TB Prepare financial statements Prepare financial statements Journalise reversing entries Journalise reversing entries Post reversing entries Post reversing entries Manual Manual Computerised Computerised Manual Manual Manual . FINANCIAL SYSTEMS AND AUDITING Chapter 1 Accounting systems FINANCIAL SYSTEMS AND AUDITING Chapter 1 Accounting systems Learning Objectives 1. Understand how an accounting system. accounting systems, and understand the essential characteristics inherent in the system 3. Identify the principles of internal control and understand the limitations of internal control systems Learning. (cont’d) 4. Understand the advantages and disadvantages of computerised accounting systems Lecture References • Hoggett, Edwards & Medlin, 6th edition, Chapter 7 Operation of an Accounting System • Converting