How can we help?

You can also find more resources in our Help Center.

12 terms

Revenue Cycle Threats and Controls

Incomplete or inaccurate customer orders
Data entry edit checks
Credit sales to customers with poor credit
Credit approval by manager, not by sales function; accurate records of customer account balances
Legitimacy of orders
signatures on paper docs, digital signatures and digital certificates for e-business
stockouts, carrying costs, and markdowns
inventory control systems; sales forecasts; periodic physical inventory counts
shipping errors, wrong merchandise, wrong quantities, wrong address
reconciliation of sales order with picking ticket and packing slip; barcode scanners; data entry applications controls
theft of inventory
restrict physical access to inventory; documentation of all internal transfers of inventory; periodic physical counts of inventory and reconciliation of counts with recorded amounts; RFID and barcode technology
Failure to bill customers
separation of shipping and billing functions; prenumbering of all shipping documents and periodic reconciliation with invoices; reconciliation of picking ticket and bills of lading with sales orders
billing errors
data entry controls; price lists
posting errors in updating accounts receivable
batch totals; reconciliation of subsidiary accounts receivable ledger with general ledger; monthly statements to customers
theft of cash
segregation of duties; minimization of cash handling; lockbox arrangements; prompt endorsement and deposit of all receipts; periodic reconciliation of bank statement with records by someone not involved in cash receipts processing
loss, alteration or unauthorized disclosure of data
backup and disaster recovery procedures; access controls (physical and logical); proper systems configuration; encryption; data transmission controls
poor performance
preparation and review of performance reports