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Source Document Controls in Accounting

This document describes various types of controls used for processing source documents and transactional data. It discusses source document controls, data coding controls, batch controls, input error correction controls, validation controls, and generalized data input systems. Specific control techniques described include using prenumbered source documents, source documents in sequence, periodically auditing source documents, batch totals, levels of input validation, error handling techniques, and components of a generalized data input system.

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Carla Jean Cuyos
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48 views18 pages

Source Document Controls in Accounting

This document describes various types of controls used for processing source documents and transactional data. It discusses source document controls, data coding controls, batch controls, input error correction controls, validation controls, and generalized data input systems. Specific control techniques described include using prenumbered source documents, source documents in sequence, periodically auditing source documents, batch totals, levels of input validation, error handling techniques, and components of a generalized data input system.

Uploaded by

Carla Jean Cuyos
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Source Document Controls Validation Controls

01 04

Data Coding Controls Input Error Correction


02 05

Batch Controls Generalized Data Input Systems


03 06

1
PURCHASE
ORDERS

RECEIVING
REPORTS

 It is a type of control that used physical source documents to initiate transactions.


 Source documents are the original record of a transaction and use as evidence of a
particular business transaction.
2
Control Procedures over Source Documents

1. Use prenumbered source documents


2. Use source documents in sequence
3. Periodically audit source documents
3
1. Use prenumbered source documents

4
2. Use source documents in sequence

5
3. Periodically audit source documents

The Power of PowerPoint | [Link] 6


These are checks on the integrity of data codes used in processing.
3 Types of Transcription errors: 2 Types of Transposition errors:
1. Addition errors 1. Single transposition errors
2. Truncation errors 2. Multiple transposition errors
3. Substitution errors 7
3 types of Transcription Errors:

Addition Errors Truncation errors Substitution errors

occurs when an extra digit occurs when a digit or are the replacement of
or character is added to character is removed one digit in a code with
from the end of a code.
the code. another.
Example:
Example:
Inventory item number Example:
Code Number
83276 83276
83276
832766 8327 83266
The Power of PowerPoint | [Link] 8
2 Types of Transposition Errors

Single transposition errors Multiple transposition errors

occur when two adjacent digits are occur when non adjacent digits are
reversed. transposed.

Example: Example:
83276 83276
38276 87236

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It means processing multiple transactions or input data at the same time.

10
2 Documents that are used to accomplish batch controls

Batch Transmittal Sheet

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Batch Control
Process
END USER DATA PROCESSING

Batch Batch Date Time Recorded Control Hash Submitted Returned Error Reconciled
# # by total Total Code by
Date Time Date Time

Batch Control Log

13
It refers to a simple control technique that uses
nonfinancial data to keep track of the records in a batch.

14
Example of Hash Total:
In the example below, the sales order number (SO#) field
for an entire batch of sales order records is summed to
produce a hash total.
SO#
14327
67345
19983
88943
96543
4537838

The Power of PowerPoint | [Link] 15


 This control is intended to detect errors in
transaction data before the data are
processed.
 This control prevents users from submitting
the wrong type of data.
 It validates the user input data to ensure that
useless, unauthenticated, or contradictory
data don't get stored.
3 Levels of Input Validation Controls:
1. Field Interrogation
2. Record Interrogation
3. File Interrogation
16
 This must be a controlled process to ensure that
errors are dealt with completely and correctly.
 Immediate correction, create an error file, and
reject the batch
3 Common Error-Handling Techniques:
1. Immediate Correction
2. Create an Error file
3. Reject the Batch

17
 This technique includes centralized procedures to manage
the data input for all the organization’s transactions
processing system.
 It ensures that each AIS application applies a consistent
standard for data validation.
It improves systems development efficiency.
4 Components of GDIS: (1) Generalized Validation Module, (2)
Error file, (3) Error reports, and (4) Transaction log 18

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