Internal Auditing and The Chief Financial Office

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Part 1 - 1000 words

The chief financial officer (CFO) of Barrington Products Company has asked the business systems team to put together a representation explaining the process that will be used to design and implement the new enterprise resource planning system.

  • Identify and explain the process steps you determined are required to design and implement the new ERP system.
  • Develop a visual representation of the steps

:Part 2 - 1000 words

Barrington's vice president of finance has expressed concern that the new accounting information system contains the security and controls necessary for the prevention of fraud and abuse. Barrington has previously experienced unauthorized data entry breach into its payroll system. You and your team have been researching available guidelines that address security and controls necessary and specifically address the concerns of the VP of finance. You have found that the Committee of Sponsoring Organizations of the Treadway Commission (COSO) has developed the Internal Control-Integrated Framework, which includes these guidelines.

  • Write a memo that includes:
    • Discussing the COSO framework.
    • Discussing how you might integrate this framework into the development of Barrington's new accounting information system.
    • Address the prevention of security breach into the payroll system.


Part 3 - 500 words

To use ERM to evaluate an accounting information system, the team must recognize the importance of the internal environment at Barrington.

  • Discuss what elements are important when identifying the internal environment at Barrington.

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Explanation & Answer

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Attached.

Running head: INTERNAL AUDITING

Internal Auditing
Student’s Name
Professor’s Name
Course Title
Date

INTERNAL AUDITING

2
Internal Auditing

Enterprise Resource Planning (ERP) system is software used in a business organization to
manage the business activities and automate various functions in the office environment that use
technology (Chang, 2016). This software allows the organization to take advantage of the wide
variety of applications that can be integrated and tailored to meet the needs of the organization.
The software can be integrated into the firm’s accounting, procurement, and supply chain as well
as project management divisions (Chen, 2001). With its adoption dating back to over 100 years
ago (Oracle, 2019), this function has evolved over the years with advances in technology that
saw improvements in the capabilities of systems being integrated to businesses. Customization
of these systems has enabled the software to be tailored around the unique activities that different
organizations engage in. this means that it can be designed in such a manner that enables the
organization to structure the software around its business and not the other way round.
An ERP system typically has 4 common characteristics. It has a modular design which
houses the different branches of the organization from accounting, distribution, and finance and
supply chain. An ERP system has a common database where all the data is stored and can be
accessed simultaneously by the different divisions in the organization. The ERP system has
flexibility in that it can always be modified to keep up with any changes that occur in the
organization’s activities. It can also be internet-connected so as to support cloud capabilities that
expand its functionality. An ERP system is capable of generating information automatically such
as warnings, and decision-making support functions (Chang, 2016). At Barrington Products
Company, this system can be seamlessly integrated in order to help with the day-to-day smooth
running of the company’s processes. In order to use this system, several steps are necessary to
follow so as to design and implement the system successively (Chen, 2001)

INTERNAL AUDITING

3

In designing the ERP system, it is important to start off with defining the goals to be met in
developing the system. This initial process involves stating the outcomes to be expected or rather
what the system is expected to deliver to the organization. It involves writing down the
functionalities that are expected to be present once the system has been developed. It is a crucial
process in that the organization is able to state the features it wants in the system in the end.
After defining the goals, developing the draught for the system follows. This forms the
entire foundation of the system hence it is very critical. In this stage, comprehensive facts of the
development process and the resources to be used in the process are established. It also involves
developing a timeframe by which to follow in the process of developing the system. This stage
states the system developers contracted to develop the software, the managers and staff to have
super user access to the system. In addition to that, the draught also includes details about the
various divisions of the company that is to be integrated into the system. All these activities
combined form the master plan of the system to be developed.
The third stage is the technical part where system developers come in to build the actual
system. The developers design the database, the system interface and all the other technical
aspects that make up the system including system security and backup features. They decide on
where the system is to be hosted whether it is local servers or on the cloud. After the technical
part, follows the reviewing process whereby the developers test the system in order to ascertain
that it meets the...


Anonymous
Excellent resource! Really helped me get the gist of things.

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