As an auditor, you are assigned to investigate a possible fraudulent situation characterized by the way the sales cycle application is conducted. During the course of investigation of the sales cycle processes, you determined the following when analyzing the generate invoice process map:
■ Items unit prices are extracted from the item table.
■ The number of items was multiplied by unit prices to calculate subtotals.
■ A salesperson verifies possible discount and approves the discount amount.
■ Tax was added.
■ The shipment amount was extracted from the shipment table and added to the sales amount.
■ The salesperson verifies invoice form on the computer screen. The salesperson has full access to the invoice form and can change any value on it.
■ The invoice was printed after being verified by the salesperson, and account receivable tables were updated.
Prepare a report of your analysis of the generate invoice process, and include manual and automated controls situations as a possible indicator of fraud.
Fraud: What will I tell my MOM?
What is SOX?
What is internal control?
What are IT controls?
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