ACC 220 Lecture Notes - Lecture 13: Cash Register, Computer Fraud, Error Detection And Correction

• School: McKendree University
• Department: Accounting
• Course: ACC 220
• Professor: Julie Goodin

Document Summary

Asset misappropriation: payroll fraud distribution of fraudulent paychecks to existent and/or nonexistent employees. Works best in organization in which supervisor distributes paychecks to employees. Policies, practices, and procedures employed by organization to achieve four broad objectives: safeguard assets, ensure accuracy and reliability of accounting records and information, promote efficiency in firm"s operations, measure compliance with management"s prescribed policies and. Preventive controls passive techniques designed to reduce the frequency of occurrence of undesirable events. Most cost-effective than detecting and correcting problems after they occur. Detective controls devices, techniques, and procedures designed to identify and expose undesirable events that elude preventive controls. Reveal specific types of errors by comparing actual occurrences to pre- established standards. Corrective controls actions taken to reverse the effects of errors detected in the detective controls. Detective controls identify anomalies and draw attention to them.