Accounting Systems and Controls Flashcards
6 cards from real AAT L4 practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Accounting Systems and Controls flashcards as text
Which of the following is an example of an application control in an accounting information system?
Answer: Input validation checks on data entry fields
Application controls are specific to individual software applications and include input validation, processing controls, and output controls. The other options are general IT controls that protect the overall IT environment.
The internal control principle of segregation of duties requires that:
Answer: No single person should control all aspects of a transaction from initiation to completion
Segregation of duties ensures no single individual can initiate, authorise, record, and reconcile a transaction. This reduces the risk of errors and fraud by requiring collusion between multiple people to bypass controls.
A SWOT analysis conducted as part of an accounting systems review considers:
Answer: Strengths, Weaknesses, Opportunities, and Threats related to the system
A SWOT analysis evaluates the internal strengths and weaknesses of the current accounting system and the external opportunities and threats that may affect it. This is a standard tool used in the AAT Level 4 unit to evaluate and recommend system improvements.
Which of the following would be classified as a weakness in an accounting system?
Answer: The purchase ledger clerk can also authorise payments to suppliers
Allowing the purchase ledger clerk to also authorise payments violates segregation of duties. This person could create fictitious suppliers and authorise payments to themselves.
Under the Bribery Act 2010, a UK organisation can be held liable if:
Answer: A person associated with the organisation bribes another to obtain business, and the organisation lacked adequate procedures
Section 7 of the Bribery Act 2010 creates a corporate offence of failure to prevent bribery. An organisation is liable if an associated person bribes another to obtain or retain business, unless it can prove it had adequate procedures in place.
When evaluating an accounting system, a cost-benefit analysis is used to:
Answer: Compare the costs of proposed system changes against the expected benefits
A cost-benefit analysis weighs the costs of implementing system improvements against the expected benefits. A change is only recommended if the benefits outweigh the costs.