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CHAPTER 10 : PROCESSING INTEGRITY, CHAPTER 10 : AVAILABILITY CONTROLS -…

- - - - Source documents and other forms should be designed to minimize the chances for errors and omissions.
        
        Two particularly important forms design controls involve sequentially prenumbering source documents and using turnaround documents
        
        All source documents should be sequentially prenumbered.
        
        Prenumbering improves control by making it possible to verify that no documents are missing.
        
        (To understand this, consider the difficulty you would have in balancing your checking account if none of your checks were numbered.)
        
        When sequentially prenumbered source data documents are used, the system should be programmed to identify and report missing or duplicate source documents.
        
        A turnaround document is a record of company data sent to an external party and then returned by the external party for subsequent input to the system.
        
        Turnaround documents are prepared in machine-readable form to facilitate their subsequent processing as input records.
        
        Turnaround documents improve accuracy by eliminating the potential for input errors when entering data manually.
        
        An example is a utility bill that a special scanning device reads when the bill is returned with a payment.
    - - prompting - An online data entry completeness check that requests each required item of input data and then waits for an acceptable response before requesting the next required item.
      - closed-loop verification - An input validation method that uses data entered into the system to retrieve and display other related information so that the data entry person can verify the accuracy of the input data.
    - - Original source documents (or their electronic images) should be retained for as long as needed to satisfy legal and regulatory requirements and provide an audit trail.
      - Source documents that have been entered into the system should be canceled so they cannot be inadvertently or fraudulently reentered into the system.
      - Note: Cancellation does not mean disposal.
      - Paper documents should be defaced, for example, by stamping them “paid.” Electronic documents can be similarly “canceled” by setting a flag field to indicate that the document has already been processed.
    - - record count - A type of batch total that equals the number of records processed at a given time.
      - hash total - A type of batch total generated by summing values for a field that would not usually be totaled.
      - sequence check - An edit check that determines if a transaction file is in the proper numerical or alphabetical sequence.
      - financial total - A type of batch total that equals the sum of a field that contains monetary values.
      - batch totals - The sum of a numerical item for a batch of documents, calculated prior to processing the batch, when the data are entered, and subsequently compared with computer-generated totals after each processing step to verify that the data was processed correctly.
    - - Source documents should be scanned for reasonableness and propriety before being entered into the system.
        
        However, this manual control must be supplemented with automated data entry controls, such as the following:
        
        field check - An edit check that tests whether the characters in a field are of the correct field type (e.g., numeric data in numeric fields).
        
        check digit verification - Recalculating a check digit to verify that a data entry error has not been made.
        
        sign check - An edit check that verifies that the data in a field have the appropriate arithmetic sign. limit check - An edit check that tests a numerical amount against a fixed value.
        
        check digit - ID numbers (such as inventory item number) can contain a check digit computed from the other digits.
        
        range check - An edit check that tests whether a data item falls within predetermined upper and lower limits.
        
        reasonableness test - An edit check of the logical correctness of relationships among data items.
        
        size check - An edit check that ensures the input data will fit into the assigned field.
        
        validity check - An edit test that compares the ID code or account number in transaction data with similar data in the master file to verify that the account exists.
        
        completeness check (or test) - An edit check that verifies that all data required have been entered.