Ergonomics Furniture Pty Ltd (Ergonomics Furniture) is an Ergonomics Furniture manufacturer located in Sydney and has just installed the company’s first computer system.
In preparing for your current audit, you have identified the following information:
The system is a local area network (LAN).
The file server and two PCs are located at Head Office in Sydney, with two other PCs located in Melbourne.
Selma Taylor, the CEO, who is located at Head Office and three clerical staff, Scot Davis, who is located at Head Office and Andy Johnson and Yang Chan, who are located in Sydney, are the only ones having logical access privileges to the computer. Their access privileges are as follows:
Selma: access to all software and all files
Scot: access to inventory
Andy: access to receipts, sales and debtors.
Yang: access to payroll, payments and payables
All software was purchased off-the-shelf with the exception of the inventory program. Due to the specialised nature of Ergonomics Furniture’s inventory, an independent IT contractor was engaged to design, develop, test and install their program.
The IT contractor fully documented the workings of the inventory system, however, neither Scot nor Selma understand the documentation.
The computer hardware at both locations is kept in locked offices.
Selma backs up all data kept on the file server on a daily basis and places a copy in a local secure storage facility.
Scot, Andy and Yang print summary reports of inventory; sales, cash receipts and debtors; and cash payments, payables and payroll, respectively, and reconcile these on a weekly basis. Any apparent errors or problems are referred to Selma for resolution.
REQUIRED
Identify five (5) strengths in Ergonomics Furniture’s general controls that will impact on the reliability of the IT information that is generated.
Outline how each of these strengths affect the audit overall.