3 General Ledger and Reporting Primary function is to collect and organizeThe accounting cycle activitiesEach accounting subsystem provides information about regular transaction.Financing activitiesInvesting activitiesThe treasurer provides information about financing and investing activities, such as the issuance or retirement of debt and equity instruments and the purchase or sale of investment securities.Budget activitiesProvided by budget departmentAdjustmentsThe controller provides adjusting entries
4 General Ledger and Reporting Activities Basic activities performed in the general ledger and reporting cycleUpdate general ledgerPost adjusting entriesPrepare financial statementsProduce management reports
5 General Ledger and Reporting General Threats Inaccurate or invalid general ledger dataUnauthorized disclosure of financial statement
6 General Ledger and Reporting General Controls Inaccurate or invalid general ledger dataData processing integrity controlsRestriction of access to general ledgerReview of all changes to general ledger data
7 General Ledger and Reporting General Controls Unauthorized disclosure of financial statementAccess controlsEncryption
8 General Ledger and Reporting General Controls Loss or destruction of dataBackup and disaster recovery procedures
9 Update General LedgerPosting journal entries that originate from two sources:Accounting subsystems.By means of summary journal entriesTreasurerUpdate general ledger for non routine transactionsJournal voucher file – contains the information that would be found in the general journal in a manual accounting system.Date of the entry, debit, credit, and amount.
10 Update General LedgerThe following types of input edit and processing controls are needed to ensure that the entries are accurate and completeA validity check – to ensure that general ledger accounts exist for each account number referenced in a journal entry.Field (format) checks - to ensure that the amount field in the journal entry contains only numeric data.A zero-balance check - to verify the total debits equal total credits in a journal entry.A completeness test - to ensure that all pertinent data are entered, especially the source of the journal entry.Closed-loop verification - matching account numbers with account descriptions, to ensure that the correct general ledger account is being accessed.
11 Update General LedgerThe following types of input edit and processing controls are needed to ensure that the entries are accurate and completeA sign check – of the general ledger account balance, once updating is completed, to verify that the balance is of the appropriate nature (debit or credit)Calculating run-to-run totals – to verify the accuracy of journal voucher batch processing
12 Update General Ledger Reconciliations and control reports Trial balanceControl account balances & subsidiary balances totalClose all temporary accounts (including suspense or clearing accounts)The audit trailTrace any transaction from its original source document (whether paper or electronic) to the journal entry that updated the general ledger and to any report or other document using the data. This provides a means to verify that all authorized transactions were recorded.Trace any item appearing in a report back through the general ledger to its original source document (whether paper or electronic). This provides a means to verity that all recorded transactions were indeed authorized and that they were recorded correctly.
13 Update General Ledger Threats Inaccurate updating of general ledgerUnauthorized journal entries
14 Update General Ledger controls Inaccurate updating of general ledgerData entry processing integrity controlsReconciliations and control reportsAudit trail creation and review
15 Update General Ledger controls Unauthorized journal entriesAccess controlsReconciliations and control reportsAudit trail creation and review
16 Post Adjusting Entries Threats Inaccurate adjusting entriesUnauthorized adjusting entries
17 Post Adjusting Entries controls Inaccurate adjusting entriesData entry processing integrity controlsSpreadsheet error protection controlsStandard adjusting entriesReconciliations and control reportsAudit trail creation and review
18 Post Adjusting Entries controls Unauthorized adjusting entriesAccess controlsReconciliations and control reportsAudit trail creation and review
22 eXtensible Business Reporting Language (XBRL) WithoutWith
23 XBRL Instance Document Taxonomy Linkbases Contains data from financial statementsMarked up or tagged with data describing the dataEach piece of data in XBRL is an elementTaxonomySet of files defining the various elements and the relationships between themA schemaContains the definitions of every element that could appear in an instance documentLinkbasesDescribes relationships between elementsReferenceIdentifies relevant authoritative pronouncementsCalculationSpecifies how to combine elementsPresentationHow to group elementsLabelAssociates human-readable labels with elements
24 Produce Management Reports Threats Poorly designed reports and graphs
25 Produce Management Report Controls Responsibility accountingBalanced scorecardTraining on proper graph design
26 Balanced ScorecardA report that provides a multidimensional perspective of organizational performance (example: page 499)Reflecting four perspectives of the organizationFinancialCustomerInternal operationsInnovation and learningShowing goals and measuresTargetsActual