IBM 1130 User Manual page 115

is generally done when transactions are edited and
may consist of assigning a system of serial num-
bers or developing a document count, a transaction
count, an item count, a tape listing and total
of some field such as quantity, amount, or code,
etc., or a combination of these. When these pre-
liminaries are taken care of, your transactions are
ready for processing.
During report preparation, the primary control
objective is to prove that all items (accounts or
transactions, etc.) are included in the processing
and that arithmetic is performed accurately
0
It
can be assumed that the data itself is correct, since
punching, summary, and posting operations are
proved as they occur.
To ensure the inclusion of all items in the report,
a final control total is developed during processing
and balanced at the end of the run to a predetermined
one. In cycle billing operations, the control may
be an account number hash total of those accounts
that are in the cycle; for other reporting operations
it may be a control total based upon an amount, a
quantity, or another code field. For control of
arithmetic functions that occur during report prep-
aration, the following techniques should be inves-
tigated: crossfooting, total transfer, zero balancing,
parallel balancing, reasonableness test, or a com-
bination of these.
Built-in checks and controls. Built-in checks
should be taken advantage of and not duplicated by
programmed or manual controls. They function as
a result of internal machine circuitry and are there-
fore performed automatically. For example, all
machines have checks which stop the machine for
an operation that is impossible or in conflict with
another.
Computers utilize input/output checks. The
input check ensures that all data is read and coded
correctly. The output check ensures that your out-
put characters are correctly set up for punching
and/or printing.
This discussion does not include all built-in
checks; for more information regarding a speCific
piece of equipment, refer to the reference manual
describing the machine.
The audit trail. An audit trail must be in-
corporated into every procedure; you should pro-
vide for it early so that it becomes an integral part.
In creating an audit trail it is necessary to provide:
1. Transaction documentation that is detailed
enough to permit the association of any transaction
with its original source document.
Section Subsections Page
20 10
I
20
06
2. A system of accounting controls which proves
that all transactions have been processed and that
accounting records are in balance.
3. Documentation from which any transaction
can easily be recreated and its proceSSing continued,
should that transaction be misplaced or destroyed
at some point in the procedure.
The audit trail shown in the accompanying ex-
hibit might be found in an accounts receivable ap-
plication. The original or entry sales register is
prepared by date of entry immediately after the
cards have been punched or activated from a file.
All punched .information is listed on the register
in detail, so that if a transaction has to be recreated
at some later time, reference to the source doc-
ument will not be necessary. To prove the accuracy
of the register's preparation, its final total is
balanced to a predetermined one; if the two are
equal, the final total is also posted to the control
sheet. The sum of these individual totals on the
control sheet establishes the final control total to
which all accounts receivable operations for the
period must balance.
Cards for the cash receipts book are either
punched or activated from a holding file. After
being prepared in detail, the cash receipts book is
balanced to a predetermined total. If it is in bal-
ance, the final total is posted to the control sheet
and the receipts are posted to accounts receivable.
When the aged trial balance is run, the final total
should equal the difference between total debits and
total credits to accounts receivable; this difference
is available from the control sheet.
If
the totals do
not agree, all the transactions for the accounting
period can be sorted into entry date sequence, sum-
marized, and checked against the daily entry totals
on the control sheet to isolate the entry date that is
out of halance. The transactions for that date are
relisted; an entry-by-entry comparison on the du-
plicate and original entry registers will reveal the
discrepancy so that a correcting entry can be
initiated.
The sales register and cash receipts book pro-
vide documentation that is sufficient for reconstruct-
ing a transaction or associating
it
with the original
source document. Balancing each register to a
predetermined total proves that all transactions in
the group have been processed through that point.
The entries on your control sheet provide the means
for balancing accounting records at the end of the
accounting period.