Internal Controls

Front 1

Process Controls

Back 1

Preventive or Detective

Front 2

Preventive

Back 2

Authorization and approval policies & guidelines

Segregation of duties

Verification

Front 3

Detective

Back 3

Look for errors and irregularities

Determine if preventive controls are effective

Front 4

Chart of Accounts

Back 4

A listing of the accounts available in an organization's accounting system

Front 5

Balance Sheet Accounts

Back 5

Assets, Liabilities and Owners equity

Front 6

Current Assets

Back 6

Are items that can easily converted to cash

Front 7

Fixed Assets

Back 7

Are long term assets such as furniture and fixtures, equipment and real estate.

Front 8

Liabilities

Back 8

Are a company's obligations such as loans and accounts payables

Front 9

Cash Flow

Back 9

Cash receipts minus cash payments over a given period

Front 10

Days Payable Outstanding

Back 10

The number of days on average that A/P takes to settle its trade payments

Front 11

Accrued Expenses

Back 11

Incurred Expenses that have not been paid in the current period.

Front 12

Common AP Transactions

When an invoice is received

Back 12

Debit the appropriate expense account

Credit the A/P Liability Account

Front 13

Common AP Transactions

When the payment is made

Back 13

Debit the A/P Liability Account

Credit Cash

Front 14

GAAP

Back 14

General Accepted Accounting Principles

A Common set of accounting Principles, standards and procedures set by policy boards that allow for financial comparison between companies.

Front 15

The Uniform Commercial Code (UCC)

Back 15

Is the Federal statute in the US that addressed check fraud

Positive Pay is the best defense against check fraud

Front 16

Basic Positive Pay

Back 16

Provide check number and amount to the bank

Front 17

Payee Positive Pay

Back 17

Provide check number, amount and payee name to the bank

Front 18

Reverse Positive Pay

Back 18

Bank provides A/P a listing of check numbers and amounts that were presented for payment

Front 19

Teller Positive Pay

Back 19

Bank tellers have online access to check issuance information

Front 20

Key element of a good A/P internal Control system that can reduce potential check fraud

Back 20

Timely reconciliation of bank accounts/statements

Segregation of duties

Front 21

Electronic payment Fraud

Back 21

ACH

Front 22

UPICS

Universal Payment Identification Codes

Back 22

UPICs look & Act like a standard bank account number but mask account & Routing information

Front 23

To Prevent Vendor Fraud

Back 23

Collect and verify critical business information

Do not do business with a new vendor until a W-9 is received

Do not deal with solicitations from advertisements from unknown publications or sources

Require vendors to sign a "Business Practices Statement"

Front 24

Asset misappropriation (3 Main Branches)

Back 24

Cash is the asset most frequently targeted

Corruption - Wrongful use of power and influence

Fraudulent statements

Front 25

Occupational Fraud

Red Flags that an employee may be committing fraud

Back 25

Employees living beyond their means

Employees experiencing financial difficulties

Excessive pressure to succed

Front 26

Identity Theft

Back 26

Phishing is the criminally fraudulent process of attempting to obtain confidential personal or sensitive information such as user names, passwords or account numbers by masquerading as a trustworthy entity

Front 27

Intellectual Property Fraud

Back 27

Employees are the biggest threat in terms of intellectual property fraud

Front 28

Key drivers of records management policies, procedures and systems are:

Back 28

Ensure regulatory compliance

Minimize litigation risk & Protect against lawsuits

Safeguard vital information

Front 29

Government agencies allow reliance on imaged documents when certain requirements are met

Back 29

Records must be available for inspection