2.

ldentify and explain controls designed to ensure systems

availability.

INTEGRATIVE CASE NORTHWEST INDUSTRIES

Jason Scott began his review of Northwest Industries' processing integrity and availability controls by meeting with the CFO and the CIO. The CFO mentioned that she
had just read an article about how spreadsheet errors had caused several companies to

make poor decisions that cost them millions of dollars. She wanted to be sure that such
problems did not happen to Northwest Industries. She also stressed the need to con'

tinue to improve the monthly closing process so that management would have more
timely information. The CIO expressed concern about the company's lack of planning
for how to continue business operations in the event of a major natural disaster such as
the recent floods in the Midwest, which had forced several small businesses to close.
Jason thanked them for their input and set about collecting evidence about the effec'
tiveness of Northwest Industries' procedures for ensuring processing integrity and

availability.

lntroduction
The previous two chapters discussed the first three principles of systems reliability identified
in the Trust Services Framework: security, confidentiality, and privacy. This chapter addrcsses
the remaining two principles ofreliable systems: processing integrity and availability. We conclude with a discussion of the importance of controlling changes to systems to ensure that the

294

new system continues to satisfy all flye principles of systems reliability identified in the Trust
Services Framework.

Processing lntegrity
The Processing Integdty principle of the Trust Services Framework states that a reliable system
is one that produces information that is accurate, complete, timely, and valid. As discussed in
CoBIT control objective DS 1 1 . 1 , this requires controls over the input, processing, and output of
data. Table 10-1 presents the six basic categories of application controls discussed in the COBIT
framework for ensuring processing integdty.

TABLE 1O-1 Application Controls Discussed in CoBIT

to Ensure Processing

lntegritY
Process

CoBIT

stage and

Category

Input:

AC

l---Souce Data

Prepamtion and

Authorization

. Ac2-source Data

ThreatyRisk

Controls

Data that is:

Forms design, cancellation and

storage of documents, authodzation
and segregation of duties conkols,
visual scanning, data entry cottrols

.
.
.
.

Invalid
Unauthorized
Incomplete
Jnaccurate

Collection and Entry

. Ac3-Accuacy,

Completeness, and
Authenticity Checks

Prccessitrg:
.

Ac4--Processing
and Validity

Integdty

Errors in output and

stored data

Data matching, file labels, batch

toials, ooss-footing and zercbalaoce tests, write-protection mechanisms, database processing integrity

coqllols
Output:

.
.

Ac5--Oufput Review,
Reconciliation and Error
Handling

AC6-Transaction
Airthefl ticity and Integdqy

.
.

Use of inaccurate or
ircomplete reports
llnauthodzed disclosure
of sensitive inforrnation
Loss, altention, ol
disclosure of information

Reviews and rcconciliations,

encryption and access controls, parity checks, message acknowledgement techniques

in transit

295

296

PART

ll .

CONTROL AND AUDIT OF ACCOUNIING INFORMATION SYSIEMs

lnput Controls
The phrase "garbage in, garbage out" highlights the importance of input controls. If the data
entered into a system are inaccurate, incomplbte, or invalid. the outpu{ will be too. Consequently,
source documents should be prepared only by authorized personnel ac!ing within their authority.
In addition, forms design, chncellation and storage of source documLnts, and automated data
entry conbols are needed to {,erify the validily of input data.
FoRMS DESIGN Source d$cuments and other forms should be d{signed to minimize the
chances for errors and omi{sions. Two parlicularly important formJ design controls involve
sequentially prenumbering sQurce documents and using tumaround dotuments.
1.

All

source documents should be sequentially prenumbered. Prenumbering improves con-

trol by making it possible to verify that no documents are missing. (To underctand this,
consider the difficulty you would have in balancing your checking account if none of your
checks were numbered.) When sequentially prenumbered source data documents are used,
the system should be programmed to identify and report missing or duplicate source
documents.
2. A turnaround document is a rccotd of company data sent to an extemal party and tien
retumed by the extemal party to the system as inpui. Tumaround documents are prepared
in machine-readable form to facilitate their subsequent processing as input records. An
example is a utility bill that a special scaaning device reads when the bill is retumed with a
payment. Tumaround documents improve accuracy by eliminating the potential for input
e[ors when entering data manually.
CANCELLATION AND S'IORAGE OF SOURCE DOCUMENTS Source documents that have been
entered into the system should be canceled so they ca[not be inadvertently or fraudulently
reentered iIlto the system. Paper documents should be defaced, for example, by stamping them
"paid." Electronic documents can be similarly "canceled" by setting a flag field to indicate that
the document has already been processed. Nore. Calcellation does flo, mean disposal. Original
source documents (or their electronic images) should be retained for as long as needed to satisfy
legal and regulatory requircments and provide an audit tlail.
DATA ENTRY CONTROIS Source documents should be scanned for reasonableness and propriety
before being entered into the system. However, this manual contol must be supplemented with
automated data entry controls, such as the following:

a
a

a
a

a
a
a

lield check determines whether the chamcters in a fleld are of the proper type. For
example, a check on a freld that is supposed to contain only numeric values, such as a U.S.
Zip code, would indicate an eror if it contained alphabetic cha.racters.
A sign check determines whether the data in a field have the appropriate adthmetic sign.
For example, the quantity-ordered field should never be negative.
A limit check tests a numerical amount against a fixed yalue. For example, the regular
houn-worked field in weekly payroll input must be less than or equal to 40 hours,
Similarly, the hourly wage field should be greater than or equal to the minimum wage.
A, range check tests whether a numerical amount falls between predetermined lower and
upper limits. For example, a marketing promotion might be directed only to prospects with
incomes between $50,000 and $99,999.
A size check e$ures that the input data will fit into the assigned field. For example, the
value 458,976,253 will not fit in an eight-digit field.
A completeness chack on each input record detemines whether all required data items
haye been entered. For example, sales transaction records should not be accepted for processing unless they include the customer's shipping and billing addresses.
A validity check compares the ID code or account number in transaction data with similar
data in the master file to verify that the account exists. For example, if product number
65432 is entered on a sales order, the computer must verify that there is indeed a product
654J2 in the invenrory database.
A rmsonableness res, determines the cofectness of the logical relalionship between two
data items. For example, overtime hours should be zero for someone who has not worked
the maximum number of regular hours in a pay period.
A

,
o

CHAPTER

10

INFORMATION SYSTEMS CONTROLS FOR SYSTEMS RELIABILIry

Authorized lD numbers (such as employee numbers)can c or.taitrr a check digit that is computed from the other digits. For example, the system could assign each new employee a
nine-digit number, then calculate a tenth digit from the original nine and append that calculated number to thq original nine to form a ten-digit ID num$r. Data entry devices can
then be
rc pertorm check digit veriJicdtion Uy Jtirg m" n.rirlr" aigi,, io
calculati thi tentn {igit iach time an ID number is entered. If an error is made in intering
the calculation made on the first nine difits will llot match the tellth,
any of the ten
or bheck digit.

The preceding data

processing. Additional

ry tesrs are used for both barch proqessing and online real-time
input controls differ for the two proceFsing methods.

ADDITIONAL g,ATCH PNOCESSING DATA ENTRY CONTROLS

a
a

*.

Batch processing works more efficiently if the tansactions are soded so that the accounts
affected arc in the same sequence as records in the master file. For example, accurate batch
processing of sales txansactions to update customer account balances requires that the
ftansactions first be sorted by customer account number A sequence check tests whelher a
batch of input data is in the proper numerical or alphabetical sequence.
An erot_lqg that identifies data input enors (date, cause, prcblem) facilitates timely review
and resubmission of halsaetions that canlot be processed.
ffi=tch totals s,Jmmadze important values for a batch of input records. The following are
tkee commonly used batch totals:
t A linaneial total sums a field that contains monetary values, such as the total dollar
amount of all sales for a batch of sales tansactions.
2. A hash tonl sums a nonfinancial numeric field, such as the total of the quantity ordered
''field
in a batsh of sales transactions.
3. A. record count is the number of records in a batch.

These batch totals are calculated and stored by the system when data is
will be recalculEd later to verify that all input was processed correcdy.

initially entered. They

ADDITIONAL ONLINE DATA ENTRY CONTROLS

Prompting,ln which the system requests each input data item and waits for an acceptable
response, e[sures that all lecessary data are entered (i.e., prompting is an online completeness check).

Closeil-loop veriJicarion checks the accuracy of input data by using it to retrieve and display other related information. For example, if a clerk enters an account number, the system
could retrieve and display the accourt name so that the user could verify that the correct
accoult number had been entered.
A transaction log includes a detailed record of all transactions, including a unique transaction identifier, the date and time of entry, and who entered the hansaction. If an online file
is damaged, the transaction log can be used to reconstuct the fi1e. If a malfunction temporarily shuts down the system, the transaction log can be used to ensure that transactions
are not lost or entercd twice.

Processing Controls
Conaols are also needed to ensure that data is processed corecdy. Important processing controls
include the following:

Data motching. In certain cases, two or more items of data must be matched before an
action can take place. For example, before paying a vendor, the system should verify that
infomation oll the vendor invoice matches information on both the purchase order and the
receiving report,
File labels. File labels need to be checked to ensure that the correct and most cu(ent files
are being updated. Both extemal labels that are reada$le by humans and intemal labels that
are written in machine-readable form on the data recording media should be used. Two
important types of intemal labels arc header and trailer records.Tlrc header record is
located at the beginning of each hle and contains the file name, expiration date, and other

297

PART

ll .

CONTROL AND AUDIT OF ACCOUNTING INFORMATION SYSTEMS

identification data. The trailer record is located at the end of the file and contains the
batch totals calculated duriog input. Progams shoutd be designed to read the header record
prior to processing, to ensure that the correct file is being updated. Programs should also
be designed to rehd the information in the trailer recotd afier processing, to verify that all
input records hale been correctly processed.
I
Recdlculation ol batch totals. Batch totals should be recomputed as eacir ransaction
record is processpd, and the total for the barch should then be compared torthe va.lues in the
trailer record. Arf discrepancies indicate a processing error. Often, the nature of the discrepancy providqs a clue about the type of error that occurred. For example, if the recomputed record count is smaller than the original, one or more transaction records were not
processed. Conversely, if the recomputed record count is larger than the original, either
additional unauthorized transactions were processed, or some trausaction records were
If a financial or hash total discrepanry is evenly divisible by 9, the likely
canse is a transposition rror, in which two adjacent digits were inadvertendy teversed
(e.g,, 46 instead of 64). Transposition errors may appear to be trivial but can have enormous financial consequences. Fot example, consider the effect of misrecording the'interest
mte on a loan as 6.4% irstead of 4.67o.
Cross-footing and zero-balfrnce tests. Often totals can be calculated in multiple ways.
For example, in spreadsheets a grand total can be computed either by summing a column
of row totals or by summing a row of column totals. These two methods should produce
the same result. A cross-footing balance les, compares the results produced by each
method to vedfy accttacy. A zero-balance ,es, applies this same logic to control
accounts. For example, the payroll cleadng account is debited for the total gross pay of
all employees in a particular time period. It is then credited for the amount of a1l labor
costs allocated to yadous expense categodes. The payroll clearing account should have
a zero balance after both sets of entries have been made; a nonzero balalce indicates
a processing error.
Wite-protection mechsnisms. These protect against overwriting or eras\Dg of data fi1es
stored on magnetic media. Write-protection mechanisms have long been used to protect
master files from accidentally being damaged. Technological innovations also necessitate
the use of write-protection mechanisms to protect the integrity of transaction data. Far
example, radio frequency identification (RFID) tags used to tack inventory need to be
write-protected so that unscrupulous customers cannot change the prici of merchandise.
Concurrent upiklte controk. Errors can occur when two or more users attempt to
update the same record simultaneously. Concurrent upilate con rrors prevent such err6rs .=
by locking out one user until the system has finished processing the transaction entered by
processed twice.

Output Controls
Careful checking of system output provides additional control over processing iDtegrity.
Impodant output controls include the following:

a
a

User review ol ourpur. Users should carefully examine system output to veriry that it is
reasonable, that it is complete, aDd that they are the intended recipielts.
Reconciliation procedures. Peiodically, all transactions and other system updates
should be reconciled to control reports, file status/update reports, or other control mechanisms. In addition, general ledger accounts should be reconciled to subsidiary account
totals on a regular basis. For example, the balance of the inyentory contuol account in the
general ledger should equal the sum of the item balances in the inventory database. The
same is fue for the accounts receivable, capital assets, and accounts payable control
accounts.
External data reconciliation. Database totals should periodically be reconciled with dita
maintained outside the system. For example, the number of employee records in the payroll
file can be compared with the total number of employees in the human resources database
to detect attempts to add fictitious employees to the payroll database. Similarly, inventory
on hand should be physically counted and compared to the quantity on hand rectrded in
the database.

CHAPTER 1O

INFORMATION SYSTEM5 CONTROLS FOR SYSTEMS RELIABILITY

also need to implement controls designed to

the teceiving device detects a data
Whenever
errors.
transmission
of
data
risk
minimiz6 the
this
transmission error, it requests the sending device to retransmit that data' Generally'
the
example'
haooens automaticallv, and the user is unaware that it has occurred Fol
number to
Transmission Controi +orocol (TCP) discussed in Chapte! 8 assigns a sequence
iach
and to
received
been
packets
have
Dacket and uses thht information to verify that all
are
contols
transmission
data
reassemble them in the torrect order TVo other common
checksums and paritY bits.
1, Checksums. When data are transmitted, the sending device can calculate a hash of the
file, called a checksum. The receiving device performs the same calculation and sends
to
to the sending device. If the two hashes agree, the aansmission is presumed

Ddtd trqnsmission controls. Organizations

the result
be accurate. Otherwise, the file is resent.
2. Parity bits. Computers reprcsent characters as a set of binary digits called bits' Each
bit has two possible values: 0 or 1. Many computers use a seven-bit coding scheme'

*.

(both
which is more than enough to represent the 26 letters in the English alphabet
($' %'
upper- and lowercase), thi numben 0 through 9, and a variety of special symbols
&, etc.). A parixy bit is an extxa digit added to the beginning of every character that can
parbe used to ;heck transmission acquracy. Two basic schemes are rcferredto as even
an
even
has
chamcter
each
ity an&odd parity.In even parity, the parity bit is set so t}Iat
of bits with the value 1; in odd parity, the parity bit is set so that an odd number
number
*JIf
bits in the character have the value l. For example, the digits 5 and 7 can be repreparity syssented by rhe seven-bit pattems 0000101 and 0000111, respectively. An even
-tem wouid set the parity bit for 5 to 0, so that it would be transmitted as 00000101
(because the binary code for 5 already has two bits with the value 1)' The parity bit for
(because the binary
7 would be sei to i so that it would be transmitted as 10000111
parity checking'
performs
device
receiving
1).
The
value
with
the
bits
code for 7 has 3
value
I in each
to
the
set
are
of
bits
proper
number
that
the
verifying
entails
which
character rcceived.

lllustrative Exa\nple: Credit Sales Processing

that have been

We now use a credit sale to itlustrate how many of the application controls
number' cusorder
used:
sales
are
data
tansaction
discussed actually function. The following
date' If the
price'
delivery
and
sale
quartity
sold,
number,
item
tomer account number, inventory
quannumbers'
item
inventory
multiple
will
be
there
product,
one
than
customer purchases more
,iii"r aofd, and prices associated with each sales transactiol Processing these transactions
data; (2) updating the cusinclucles the following steps: (1) entering and editing the bansaction
to the customer's baltomer and inYentory iecords (the amount of the credit purchase is added
on hand); and
quantity
the
ance; for each inventory item, the quantity sold is subtracted from
batch and
for
both
Examples
(i) preparing and distrituting shipping ari/or billhg documents'
online processing are Presented.

the application
BATCH PRoCESSING INTEGRITY CoNTROLS Figure 10-1 shows
transactions:
sales
credit
batch
of
processing
a
shoutd be applied at each step of

conhols that

a financial total and

7. Prepre batch totuls. The surn of all sales amounts is calculated as
documents'
group
of
sales
each
recorded on batch control forms that accompany
Each
2, Deliver the transactions to the computer operations delnrtment lor processing'
log'
contuol
in
a
recorded
batch is checked for proper authorization and
As dala xe entered, the System performs
3 . Enter the transaction datd into the slstem,
verification identifies transactions with
digit
Check
several preliminary validation tests.
numbers' Field checks Yerify that the
item
inventory
invalid account numbers or invalid
and that the date field follows the
numbers
only
contain
price
fields
quantity ordered and
order numbers and reconciliaon
sales
check
sequence
A
format.
*oeciUUOOfyyYY

tionofthebatchtotalscalculatedinsteplvedfiesthatnoffansactionsaremissing.
A control report lists all data entry erors. Data enty errors that occurred because

an
can
key
operator read a ;ource document incorrectly or accidentally struck the wrong
as an
such
data'
source
lncorrect
detected
being
after
immediately
corrected
usually be

299

PART

ll .

CONTROI AND AUDIT oF ACCoUNTING INFoRMATION SYSTEMS

FIGURE 10.1

ConEol Pro.edurc3

Protesslng Proreduret

Application Controls in
Batch Processihg

of

Credit Sales

I SreD I
. R*..d c","r JI n,-her of soles orderc
. Hosh totols o[ &uontiry sold ond price
. Finoftiol totdl 6t Jollor bls
1

SreP 2

Check input for proper outhorizotion

Eni:r record o[ inpul receipt in confol log

Slep 3

r Check digil verificotion of occount number

.
.

Check digit veriffcotion of invenlory ilem numher

Field checks on quonlity, dote, ond price
Check seouence o[ soles order nr.rmbers
Rs6n.;ti;i6n df hdkh

rcrdlr \

unauthorized sales transaction or an invalid account number, are more problematic ahd
should be retumed to the sales department for correction.
4, Sort and edit the transaction lile. The transaction file is now sorted by customer
account number. Additional validation checks are performed, including sign checks that
both the quantity ordered and price fields contain positive trumbers, and a range check on
promised delivery dates to yeriry that it is not earlier than the date of the order nor later
than the company's advertised policies. Rejected transactions are listed on a control repof
along with the computed batch totals. Data control reconciles the batch totals, investigates
and corrects any errors, and submits the corrected tmnsactions for processing.
5. Update thz masterfles. The sales transaction file is processed against customer
(accounts receivable) and inventory databases or master files. The operator reads the external label, and the program reads the intemal header record to ensure that the correct master
file is being updated. Sales transactions witl customer numbers or item numbers that do
not exist in the corresponding master frle are not plocessed: instead, they are entered on, an
error report. After a sales transaction is processed, a sign check is performed to ensure tltat
the quantity-on-hand field in the inventory master record is not negative. Tests arc also performed to ensure that sales prices fall within normal ranges, that ihe order dos not exceed
the customer's credit limit, alld that the quantity ordered is reasonable given the nahlre of
the item and the customer's order history. Redundant data check-for exampb, comparing inventory item number and description-are used to ensure that the correct master file

CHAPTER 1O

INFoRMATIoN SY5TEMS CONTRoLS FoR SYSTEMS RELIABIUry

Cortrol Prcaedutet

Pro<essing Procedurel

I
Step 4
S.ou.n.e c eck on occount number

.
.

Limil checkslon quonlity ond price

Ronge chect on deliter)' dote

r Comoletenels

test on enlire record

Reconciliofidn o[ bolch iotols
Review errofs idenfilied by edit checks
lnvestigotion ond correc-tion of erroneous inPul

.
.
.

SleP 5

Securiv of moster files in ffle librory

Protection of moster files *ittr file lobek

A/R ond
inveniory
mosier
files

o Moinl,enonce of bockuP copies o[ moster liles

. Volidiv check of cuslomer occouni number
. Volidity check of invenlory il,em number

Sign cfieck of inventor/ quontity on hond

timit check of sole omounl versus credil limil
o Ronoe check on sole price
. Reoionobleness test o[ quontity ordered
. Redundont doto check on cuslomer doto
r Redundont doto check on invenlory dols

SleP 6

.
.
.
.

Reconciliofion of botch tolols

Review o[ erors idenffied by edn checks
lnveslioolion ond corre<lion o[ erroneous inPul
Distrib-ution of billing ond shipping documenls
Recording of output-distribution in conhol log
Retum of moster ftles to lile libroDr

Vsuol insoeclion of ouhul

SleP 7

n.conciliJtion of both

ttk

this financial total is

record is updated. The total change in customer balances is computed;
processed'
were
that
transactions
all
compared ao the total sales amount of
documents and a
6. Prepare anil ilistribute output. Outpus include billing and/o-r shiPPing
the file update
during
accumulated
totals
batch
contains
cor;ol repofi. The contol report
program'
update
the
by
rejected
run and a list of hansactions
of
7. (Jser review. Users in the shipping and billing departunents perform a limited review
the
compare
the documents for incomplete a;ta ;r other obvious deficiencies' They also
batch totals to those calculated in step I to verify tlat all transactions
system-generated
were processed.

records each credit

oNLINE PROCES5ING INTEGRITY coNTRoLS Online real-time processing
detection and
timely
more
enables
sales txansaction individually as it occurs (Figure 10-2)' This
at each
are
applied
in
this
chaPter
correction of errors. The various application conhols discussed
follows'
as
processing,
stago (input, processing, output) of online transaction
Online Data Entry Cortrols

the identity
When an employee accesses the online system, logical access controls confirm
the
ernployee's
of
of the data entry device (pe$onal computer, terminal) and the validity
user ID number and Password.

301

FIGURE 1O-1 Continued

3O2

PART

ll .

CONTROL ANO AUDIT OF ACCOUNTING INFORMAIION SYSTEMS

FIGURE 1O-2
Online Processing

Application Controls in
Online Processing of
Credit 5ales

Controls Applied os
Tronsoction Updotes the
Cuslomer ond lnveniory
Dotoboses

Online Doto Enlry Conkols

Applied to Eoch Soles
Tronsoction

a
a
a
a

Online Output Controls

Apptied ic Reskici Access
to Prinhd Documenls ond
Query Results

A compatibility test ensures that the employee is authorized to perform that task.
The system automatically assigns the txansaction the next sequential sales order number
and the current date as the date of the invoice.
The system prompts for all required input (completeness test). After each prompt, the system waits for a response.
Each response is tested using one or more of the following contols: validity checks (valid
customer and inventory numbers), field and sign checks (only positiye, numeric characters
in the quantity, date, and price fields), and Iimit or range checks (delivery d{tc versus
curTent date).

When the customer number is entergd, the system retrieves the coflespolding customer
name from the database and displays it on the screen (closed-loop verification). The operator visually examines the customer name. Ifit matches the name on the sales order document, the operator signals the system to proceed with the txansaction. If not. the operator
rechecks the customer number and enters the correct value.
When the inyentory item number is entered, the system and the operator go through the_
same procedures as they do with the customer number.

Online Processing Controls. Because the file update program accesses the custorGf and
inyentory database records, it performs additional input validation tests by compaiing data in
each transaction record with data in the corresponding database record. These tests often include
the following:

a
o
a
o
a

Validity checks on the customer and inventory item numbers

Sign checks on inventory-on-hand balarces (after subhacting quantities sold)
checks that compare each customer's total amount due with the credit limit
Range checks on the sale price of each item sold relative to the permissible range of prices
for that item
Reasonableness tests on the quantity sold of each item relative to normal sales quantities
for that customer and that item

Limit

Orline Output Controls. Outputs of this process include bilting and/or shipping documents and
a conhol report. The following output conhols are used:

a
a
a

Billing

and shipping documeBts are forwarded electonically only to preaurhorized users.

Users in the shipping and billing departments perform a limited review of the documents
by visually inspecting them for incomplete data or other obvious effors.
The control report is sent automatically to its intended recipients, or the recipients can query
the system for the report. If they query the system, logical access controls confirmthe identity ofthe device making the query and the yalidity of the user's ID number and password.

CHAPTER

10

Today many organizations implement and benefit from

electronic procurement systems. Among these benefiti aril

dramatic cost savings, which, studies by the European
Committee indicate, can be as large as 40 % lo 75o/o.
To improve the efficiency and reliability of the procurement process, a large Dutch university implemented
Basware, an enterprise purchase-to-pay and financial management solution. The university processes approximately
10,000 invoices per month. However, most invoices are still
received through the mail. These invoices are scanned and,
by

the use of an Optical Charader Recognition technique,

are automatically matched to a purchase order or a contrad

in the Financial Accounting and Controlling module of sAP
(sAP Fucg)-After verifying that the reclpient received the
goods or services, the budget owner receives an e-mail askind'5im/her to verify and authorize the invoice within five
working days. The budget owner has the ability to see the
original invoice and can therefore easily authorize it. lf the
budget owner has not authorized the invoice within five
days, Basware rqsends the invoice to a substitute budget

INFORMATION SYSTEMS CONTROLS FOR SYSTEMS RELIABtLITY

owner or a manager after seven days. After the invoice has

been approved, Basware generates a journal entry, which i5
entered automatically in 5AP FI/CO. In turn, sAP Fllco generates a weekly batch file. Thi5 file is imported by an online
banking application, after which the financial manager
and/or director car| authdrize the payment,
The university implemented a number of controls in the
process to guarantee the processing integrity of their
invoices. The legality of the payment and the archiving of
the invoices were crucial elements in complying with the
controls requirements of the European Commission and the
local tax authorities. Key controls include the following:

a
a
a

Segregation of duties (authorizations)

Automated three-way match
Automatic allocation of accounts in the general ledger

and cost centers

Data transmission controls between the different lT

Write-protection of the scanned files and payment files

systems

The preceding example illusbated the use of application contlols to ensure the integdty of processing busines\transactions. Focus 10-1 explairls the importance ofprocessing integrity controls
at a large Dutch university.

Processing lntegrity Controls in Spreadsheets

Most organizations have thousands of spreadsheets that are used to support decision making. The
impotance of spreadsheets to financial reporting is reflected in the fact that the ISACA documejnt IT Control Objectives for Sarb.tnes-Oxley corltair,S a sepalate appendix that specifically
addresses processing integrity contxols that should be used in spreadsheets. Yet, because spreadsheets are almost always developed by end users, they seldom contain adequate application contlols. Therefore, it is not surprising that many organizations have expe enced serious problems
caused by spreadsheet errois. For example, an August 17,2007, afiicle in CIO Magazinel
describes how sprcadsheet erors caused companies to lose money, issue erroneous dividend
payout announcements, and misreport financial results.
These kinds of costly mistakes could have been prevented by careful testing of spreadsheets
before use. Although most spreadsheet software contains buillin "audit" features that can easily
detect common errors, spreadsheets intended to support important decisions need more thorough
testing to detect subtle erIoIS. Nevertheless, a survey offinance professionals2 indicates that only
2Vo of firrrLs use multiple people to examine every spreadsheet cell, which is the only reliable
way to effectively detect spreadsheet errors. It is especially important to check for hardwiring,
where formulas contain specific numeric values (e.g., sales tax = 8.57o x A33), instead of referencing a cell that contains the current value for that variable (e.g., sales tax : A8 x A33). The
problem with hardwiring is that the spreadsheet initially produces corect answers, but \^7hen the
hardwired variable (e.g., the sales tax rate in the precedisg example) changes, the formula may
not be corrected.
rThomas Wailgum, "Eight of the worst Spreadsheet Blunders," C/O Mai,a
corn i an icle/ I 3 I 500/Ei8h t_of_lhe - Worst- S preads heet-Errors

rRalmond R. Panko, "Controlling Spreadsheets,"

Accessible at wwwjsaca.org/publications

zin" (August 200?), available at www.cio.

Inforruttio Sytem$ Control Joumal'Online

(2UJ7): Volume 1.

304

PART

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CONTROL AND AUDIT OF ACCOUNTING INFORMATIoN sYsTEMs

Availability
Interruptions to business processes due to the unavailability of systems or information caD cause
significant financial losses. Consequent,y, COBIT seftion DS 4 addresses the importance of
ensuring that systems and information are availablelfor use whenever needed. The primary
objective is to minimize the risk of system downtime.Jlt is impossible, howeyer, to completely
eliminate the risk of downtime, Therefore, organizations also need conhols designed to enable
quick resumption of normal operations after an event disrupts system availability. Table 10-2
summarizes tie key conuols related to these two objectives.

Minimizing Risk of System Downtime

Organizations can undertake a ya-riety of actions to minimize the dsk of system downtime.
CoBIT control objectiye DS 13.5 idenlifies the need for preventive maintenance, such as cleaning disk drives and properly storing magnetic and optical media, to reduce rhe dsk of hardware
and software failure. The use of redundant components provides fault tolerance, whioh is the
ability of a system to continue functioning in the eyent tiat a particular component fails. For
example, many organizations \se redundant arats of independent ilives (RAID) instead of
just one disk drive. With RAID, data is written to multiple disk drives simultaneously. Thus, if
one disk drive fails, the data can be readily accessed from another.
COBIT section DS 12 addresses the importance of locating and designing the data centers
housing mission-critical servers and databases so as to minimize the risks associated with natural
aad human-caused disasters. Common design features include the following:

o
a
a
a

a
a

Raised floors provide protection from damage caused by flooding.

Firc detection and suppression devices reduce the likelihood of fire damage.
Adequate air-conditioning systems reduce the likelihood of damage to computer equipment
due to overheating or humidity.
\Cables with special plugs that cannot be easily removed reduce the risk of system damage
due to accidental unplugging of the device.
Surge-protection devices provide protection against temporary power fluctuations that
might otherwise cause computers and other network equipment to crash.
AL uninteftuptible power supply (UPS) system provides protection in the event of a prolonged power outage, using battery power to enable the system to operate loqg enough to
back up critical data and safely shut down. (Howeyer, it is important to regularly inspect
and test the batteries in a UPS to ensure that it will function when needed.)
Physical access controls reduce the dsk of theft or damag

Training can also reduce the risk of system downtime. Well-trained operators are less likety

to make mistakes and will know how to recover, with minimal damage, from e[ors they do
commit. That is why COBIT conEol objective DS 13.1 stresses the importance of defining and
documenting operational procedures and ensuring that IT staff understand their responsibilities.
System downtime can also occur because of computer malware (viruses and worms).
Therefore, it is important to install, run, and keep current antivirus and anti-spyware programs.
These programs should be automatically invoked not only to scan e-mail, but also any removable

TABLE'10-2 Availability: Oblectives and Key Controls

1. To minimize risk of

sysrem downlime

.
.

2. Quick

and complete recovery and resumpiion

of normal operations

Prcventive maintenance
Fault tolennce
Data center locadon and

design

. Training
. Patch management and antivirus soffware
. Backup procedures
. Disasrer recovery plan (DRP)
. Business continuity plan (BCP) ,

CHAPTER
Timo o[ lost
DOCXUp

t0 .

much doic
poienfiolly lost

Hc'r,v

INFORMATION SYSTEMS CONTEOLs FOR SYSTEMs RELIABILITY

How long

sysl,em

down

Time system
reslored

computer media (CDs, DVDS, USB drives, etc.) that are brought isto the organization. A patch
management system provides additional protection by ensuring that vulnerabilities that can be
exploited by malware are fixed in a timely manner

Recovery and Resumption of Normal Operations

The preventive controls discussed in the preceding section can minimize, but Ilot entirely eliminate, the risk_o_f system downtime. Hardware malfunctions, software problems, or human error
can cause data to become inaccessible. That's why backup procedures are necessary. A backup
is an dfaict copy of the mosl cunent version of a database, file, or software program that can be
4.sed in the eyent that the original is no longer available. Natural disasten or terorist acts can
destuoi not only data but also the entire information system. That's why organizations also need
disaster recovery and business continuity plans.
An organizatioa's backup procedures and disaster recovery and business continuity plans
reflect lnanagement's answers to two fundamental questions:
1. How much data arc we willing to rccrcate ftom source documents (ifthey exist) or potentially
lose (if no source documents exist)?
2. How long c1n the organization function without its information system?

Figure 10-3 ihows the relationship between these two questions. When a problem occurs,
data about everything that has happened since the last backup is lost unless it can be reentered
into the system. Thus, management's answer to the hISt question determines thc organization's
recovery point objecfire (RPO), which represents the maximum amount of data that ttle organization is willing to potentially lose. The answer to the second question determines the otgatizatiola's recovery time objective (RTO), wbich represents the length of time that the organization is
willing to attempt to function without its information system.
For some organizations, the answer to both questions is close to zero. Airlines and financial
institutions, for example, cannot operate without their information systems, nor can they afford
to lose inforrnation about tuansactions. For such organizations, the goal is not quick recovery
from problems, but resiliency. The solution is to employ real-time mtrroir,g. Real-time mirroing
involved maintaining two copies of the database at two separate data centers at all times arld
updating both copies in real-time as each tmnsaction occurs. In the event that something happens
to one data center, the organization can immediately switch all daily activities to the other
For other organizations, however, acceptable RPO and RTO may be measurcd in hours or
even days. Achieving those goats requires data backup procedures plus disaster recovery and
business continuity plans.
DATA BACKUP PROCEDURES Data backup procedures are designed to deal with situations
where information is not accessible because the relevant files or databases have become
comrpted as a result of hardware failure, software problems, or human error, but tbe information
system itself is still functioning. Several different backup procedures exist. A Jull backup is an
exact copy of the entire database. Full backups are time-consuming, so most organizations only
do full backups weekly and supplement them with daily partial backups. Figure 1G4 compares
the two types of daily partial backups:

l.

An incremental backup involves copying only the data items that have changed since the
last partial backup. This produces a set of inqremental backup files, each containing the

FIGURE 10.3
Relationship of Recovery
Point Objective and
Recovery Time Objective

PART

ll .

SYSTEMS
CONTROL AND AUDIT OF ACCOUNTING INFORMATION

FIGURE 1O-4

Ponel A: lncremenlol DoilY BockuPs

Resl,ore Pro<ea!:

Comparison of
lncremental and
Differential DailY
Backups

l.
I

Bockup

Mondoy
Activity

Sundoy

[londoy

Bockup
Tuesdoy

Bockup

bockup

Activity

TuesdoY

Sundoy full
bockup
Mondoy bockup
Tuesdoy bockup

WednesdoY

Ponel Bl Differcntiol Doily BockuPs

Bockup
Bockup
Bockup

Mondoy &

Mondoy
Aclivity

Tuesdoy

Mondoy

Tuesdoy &

Acliviry

Tuesdoy

WednesdoY

loading the last full backuP and

results of one day's transactions. Restoration involves first
proper
sequenc-e'
the
in
backup
incremental
then iNtalling each subsequent
ful
the-la:t
since
gackuplihus' each new
made
changes
all
uckup copies
z."i-irniiiinfi
-'
the last full
aiffJi*tia Uu"tup fiie contains the cumulative effects of all activity since
daily differential
;;;;;.4r.;q.-tly, except for the first day following a full backup' however'
because
bu"t.p, rak" torger tiian iriremental backups' Restoration is simplel'
differential'
recent
tlle last futl Uactip needs to be supplemented with only the most
files'
backup
incremental
daily
a
set
of
of
instead
backup,
copies should be creatg-d' One
No matter which backup procedure is used, multiple backup
failure oia
;n-site, for use in the event of relatively minor problems' such as
copies
backuP
any
";;;;."J
"";
In the evenl of a more serious problem, such as a fue or flood,
hatd drive.
to
needs
copy
backup
or inaccessible. Therefore, a second

siored on-site will likely be destroyed

either physi
i" ,to."J oroit". n ese backup fi1es cau be tanspoded to the remote storagerit
need to be
controls
t:"1":v
t'""In eithei case,

il-;;t";r) or electonicallv. the original.copy.

th"
of the information' This means
;;;iift;"kt p files as are used to protect
storage aud during electronic
in
both
dil;"hrp copiis of sensitive data should be encrypted contolled
and monitored'

iarv i"e-

t--"
unarnirrion. e"""ts to backup files also needs to be carefully
iit at" t.p""ant to peri;dically practice restoring a system from its backups'

This verifies

conectly and that the backup media (tape or disk) can be

tfrut U," Uu"top p.*eclure is workini

rcad by the hardware in use.
successfully
-

su"k ;, ar" ."tuined for only a relatively short period of time' For example' many organizations
*art ln onty a"*t"t months oflackuPs. Some information, horr'ever' must be stolEd much longer'

as an historiof a database, master file, or software that is retained indefnitly

copies of
multiple
*o.0,*ouUy to satisry legal and regulatory requfements As with backups'
seldom
are
archives
"J
."t ir", ,t outa U" *ade and stored iniifferent locations. Unlike backups, the
decryption'key'
because their long retention times increase the risk of losing
archive-files'
"r"rypt"a
C"rJ.qr"tdy, pfty.i"al and lolical access controls are the primary means ofprotecting
is faster'
backup
Disk
disk?
U/hat meiia should be used for backups and archives' tape or
durable'
more
and
to
tansport'
easier
and disks are less easily lost Tape, however, is cheaper,
speed'
for
to
up
backed
fust
are
Crrt"q.*,fy, many orlanizations use both media' Data
Ssk'

An archive

(x)py

and then transferred to tape.

FoR sYsrEMs

;::'::#

speciarauention needs to be paid to backi,,

an importani repository of organizational behavior and information. tndeed, e-mail often contains solutions to specific problems. E-mail also frequendy contains information relovant to lawsuits. It may be tempting for an organizatign to consider a policy of periodically deleting all
e-mail, to prevent a plaintiff's attomey fton[ finding a "smoking gun" and to avoid the costs of
finding the e-mail requested by the other pafty. Most expens, howeve( advise against such policies, because there are likely to be copies of the e-mail stored in archives outside the otgaLization. Therefore, a policy of regularly deleting all e-mail meam that the organization will not be
able to tell its side of the story; instead, the court (and jury) will only read the e-mail created by
the other party to the dispute. There have also been cases whele the courts have hned organizations millions of dollars for failing to produce requested e-mail. Therefore, organizations need
to back up and archive important e-mail while also periodically purging the large volume of

"#-t"

-"::-Ls

routine, trivial e-mail.

DISASTER RECOVERY AND BUSINESS CONTINUIry PLANNING Backups are designed to mitigate
problems when one or more files or databases become comrpted because of hardware, software,
or human error. Disaster recovery and business continuity plans arc designed to mitigate more
serious problems.
A disastpr Jecovery plm (DRP) outlines the procedures to restore an organization's IT
function in the event that its data center is destroyed by a natural disaster or act of terrorism.
OrganiTitions have three basic options for replacing their IT infrastructure, which includes not
jnst computers, but also network components such as routers and switches, software, data,
InternEt access, printers, and supplies. The flst option is to contact for use of a cold s/e, which
is an empty building that is prewired for necessary telephone and Intemet access, plus a conhact
with one or more veddors to provide all necessary equipment within a specified period of time. A
cold site stitl leaves the organization without the use of its information system for zr period of
time, so it is appopriate only when the organization's RTO is one day or more. A second option
is to contract for use of a hol si/e, which is a facility that is not only prewired for telephone and
Intemet access but also contains all the computing and ofnce equipment the organization needs
to perform its esslntial business activities. A hot site typically results in an RTO of hours.
A problem with both cold and hot sites is that the site provider typically oveNells its capacity, under the assumption that at any one time only a few clients will need to use the facility. That
assumption is usually warfanted. In the event of a major disastel such as Hurricane Katrina, that
affects all organizations in a geographic area, however, some organizations may find that they
cannot obtain access to their cold or hot site. Consequently, a third infrastructure replacement
option for organizations with a very short RTO is to establish a second data center as a backup
and use it to implement real-time mirroring.
A business continutty plan (BCP) specifies how to resume not only IT operations, but a1l
business processes, including relocating to new ofEces and hiring temporary replacements, in the
event that a major calamity destoys not only an orgadzation's data center but also its main headquarters. Such planning is important, because more than half of the organizations without a DRP
and a BCP never reopen after being forced to close down for more than a few days because of a
disaster. Thus, having both a DRP and a BCP cal mean the differeuce between surviving a major
catastrophe such as Hurricane Katrina or 9/11 and going out of business. Focus 10-2 describes
how planning helped NASDAQ survive the complete destruction of its ofEces in the World Trade
Center on September 11, 2001.
Simply having a DRP and a BCR however, is not enough. Both plans must be well documented. The documentation should include not only instructiom for notifying appropriate staff
and the steps to take to resume operations, but also vendor documentation of all hardware and
softvr'are. It is especially important to document the numerous modifications made to default
configurations, so that the replacement system has the same functionality as the original. Failure
to do so can create substantial costs and delays in implementing the recovery process. Detailed
operating instructions are also needed, especially if temporary replacements have to be hired.
Finally, copies of all documentation need to be stored both on-site and off-site so that it is available when needed.
Periodic testing and revision are probably the most important components of effective disaster recovery and business coutinuity plans. Most plans fail their initial test because it is impossible

RE,ABT,ry

307

PART

ll .

CONTROL AND AUDIT OF ACCOUNTING INFORMATION SYsTEMS

to fully anticipate everything that could go wrong. The time to discover such problems is not during an actual emergency, but mther in a setting in which weaknesses can be carefully and thoroughly analyzed and appropriate changes in procedures made. Therefore, ilisaster recovery and
business continuity plans need to be tested on at least an annual basis to ensure that they accurately reflect rccent changes in equipment and procedures. It is especially important to tPst the
procedures involved in the transfer of actual operations to cold or hot sites. Finally, DRP and
BCP documentation needs to be updated to reflect any changes in procedures made in-rcsponse
ro problems identified during tesls of those plans.
EFFEC|S OF VIRTUALIZATION AND CLoUD COMPUTING A virtual machine isjusi a collection of
software files. Therefore, if the physical seryer hosting that machire fails, the files can be
installed on another host machine within minutes. Thus, virtualization significantly reduces the
time needed to recoyer (RTO) from hardware problems. Note that virtualization does not
eliminate the need for backups; organizations still need to create periodic "snapshots" of desktop
and server virtual machines and then store those snapshots on a network drive so that the
machines can be recreated. Virtualization can also be used to support real-time mirroring in
which two copies of each virtual machine are run in tandem on two separate physical hosts.
Every transaction is Eocessed on both yirtual machines. If one fails, the other picks up rvithout
any break in service.
Cloud computing has both positive and negative effects on availability. Cloud computing
typically utilizes banks of redundant servers in multiple locations, thereby reducing the risk that
a single catastophe could result in system downtime and the loss of all data. However, if a Public ctoud provider goes out ofbusiness, it may be difhcult, ifnot impossible, to retrieve any data
stored in the cloud. Therefore, a policy of making regular backups and storing tbose backups
somewhere other than with the cloud provider is critical. In addition, accountants need to assess
the long-run financial viability of a cloud provider before their organization colrmits to outsource any of its data or applications to a public cloud.

CHAPTER

10

INFORMATION SYSTEMS CONTROLS FOR SYSTEMS RELIABILIry

Change Control
'::j.$.-

'tT:]:r.r.i{ri

COBIT sections AI 6, AI 17, and DS 9 address different aspects of thp critically important topic of
clange control. OrganizEtions constantly modify thei informatiorl systems to reflect new busiriess practices and to takg advantage of advances in information technology. Change control is
the formal process used io ensure that modifications to hardware, software- or processes do not
reducri systems reliabihtf. In fact, good change control often results in overall better oprat:Lg
performance: careful tes]ing prior to implementation reduces the llketihood of making changes
that cause system downtllne, and thorough documentation facilitatis quicker "trouble-shooting"
and resolution of any problems that do occur. Companies with a good change conEol process are
also less likely to suffer financial or reputational harm from secudty incidents.
Effective change control procedures require regularly monitoring for unauthorized
changes and sanctioning anyone who intentionally introduces such changes. Other principles of
a well{esigned change control process include the following:

*.

All change requests should be documented and follow a standardized format that clearly
identifies the nature of the change, the reason for the request, the date of the request, and
the outcome of the request.
t All chiirges should be approved by appropriate levels of management. Approyals should be
tlearly documented to provide an audit trail. Managers should consult with the CISO or
other II managers about the effects of the proposed changes on systems reliability.
o-To assess the impact of the proposed change on all five principles of systems reliability,
changes should be thoroughly tested prior to implementation in a separate, nonproduction
environment, not the system actually used for daily business Processes. (Virtualization
technology can be used to reduce the costs of creating a separate testing and development
system). As data from old frles and databases are entered into new data structures, conversion controls are needed to ensure that the new data storage media are ftee of errors. The old

a
o
o
a

and new systems should be run in parallel at least once and the results compared to identify
discrepandes. Intemal auditors should review data conyersion processes for accuracy.
All documantatiol (program instxuctions, systems descriptions, backup and disaster recovery plans, etc.) should be updated to reflect authorized changes to the system.
"Emergency" changes or deviations from standard operating policies must be documented
and subjected to a formal review and approval process as soon after implementation as
practicable. All emergency changes need to be logged to provide an audit trail.
"Backout" plans need to be developed for reverting to previous configurations in case
approved changes need to be interrupted or abandoned.
User rights and privileges must be carefully monitored durlng the change process to ensure
that proper segregalion of duties is maintained.

Probably the most important charge conaol is adequate monitoring aad review by top management to ensure that proposed and implemented changes are consistent with the organization's
multiyear strategic plan. The objective of this oversight is to make certain that the organization's

information system continues to effectiyely support its stategy. Many organizations create IT
steering comnittees to perform this important monitoring function.

Summary and Case Conclusion

Jason's report assessed the effectiveness of North\ est Industries' controls designed to ensure
processing integrity. To minimize data enky, and the oppo unity for mistakes, Northwest
Industries mailed turnaround documents to customeG, which were returned with their payments.
All data entry was done online, wift extensive use of input validation routines to ensure the accuracy of the information entering the system. Managers reviewed output for reasonableness, and
the accuracy of key components of hnancial reports was regularly cross-validated with independent sources. For example, inventory was counted quarterly, and the results of the physical
counts were reconciled to the quantities stored in the system.

310

PART

ll .

CONTROL AND AUDTT OF ACCOUNTING INFoRMATION SYSIEMS

Jason was concemed about the effectiveness of conkols designed to ensure systems availability, however. He noted that although Nortiwest Industries had developed a disaster recovery and
business continuity pla[, those plans had not been reviewed or updated for three years. Of even
greater concem was tlb fact that many portions ofthe plan, incluping arrangements for a cold site
located in Califomia, had never been tested. Jason's biggest contem, however, related to backup
procedures. All files ulere backed up weekly, on Saturdays, onto,DvDs, and inqemental backups
were made each nighti but no one had ever practiced restoring tfre data. ln addition, the backups
were not encrypted. and one copy was stored on-siLe in *r main sfrver room on a shelfby the door
Jason also docum{nted evidence of weaknesses related to chafrge contol. One point of concem
was the finding that "einergency" changes made during t}e past yqar werc not documented. Another
was the fact that in order to save money, Northwest l[dustdes gave programmers access to its transaction prccessing system to make changes, mther than using a separate testing and development sysGm.

Jason concluded his rcport with specific recommendations to addrcss the weaknesses he had
found. He recommended that Northwest Industries iDmediately test its backup restoration prccedures and encrlpt its backup f,les. Jason also recommended testing the DRP and BCP plam. Another
recommendation was to purchase a server that would use virtualization software to create a'testing
and developmelt system and resaict progmmmers' access to only that virtual system. Finally, he
suggested the CIO should assign someone to update the documentation to record the effects of
"emergency changes" made during the past year and implement procedures to ensure that all
future changes be documented. Jason felt confident that once those recommendations were implemented, management could be reasonably assured that Northwest Industries' infomation systems
had satisfied the AICPA s Trust Services fiamework criteria and pdnciples for systems reliability.

Key Terms
tumaround document 296
field check 296
sign check 296
limit check 296
range check 296
size check 296
completeness check 296
Yalidity check 296
reasonableDesstest 296
check digit 297
check digit verification 297
sequence check 297
batch totals 297

\-

record 297
trailer record 298
header

transpositionerror

298

cross-footing balance

test

zerc-balance test 298

concuftent update

controls

298
299

padty bit 299

parity checking 299
fault tolerance 304
redundant arrays of
independent drives
(RArD) 304
uninterruptible power supply
(uPs) 304

total 297
hash total 297
financial

count 297
Fompting 297
record

closed-loop verificatiotr 297

backup

(RTO)

305

real-timemirroring

298

checksum

recovery point objective

(RPO) 30s
recovery time objective
305

incremental backup 305

clifferential backup 306_
archive 306
disaster recovery plan_,

(DRP)

307

sire 307 - '=

hot site 307
cold

business continuity plan

(BCP) 307
change control 309

305

ACI'ON

AIS

'N

Chapter Ouiz
l.

Which of the following measures the amount of data that might be potentially lost as a
result of a system failure?

a. recoYery time objectiYe (RTO)

b. recovery point objective (RPO)

c. disaster recovery plan (DRP)

d. business coutinuity plan (BCP)

CHAPTER 1O

2.

INFORMATION SYSTEMS CONTROLS FOR SYSTEMS

Which data entry application control would detect and prevent entry of alphabetic characters as the price of an inventory item?
c. reasonableness check
a. field check

d.

b- limit check

sign check

Which of the followfng controls would prevent entry of

a sales transaction?

a. field check I
b. completeness check
4-

nonexistent customer number in

c. validitY check
d. batch total

Which disaster recovery stategy involYes cont acting for use of a physical site to which
all necessary computing equipment will be delivered within 24 to 36 hours?

a.

virtualization

c. hot site
d. data mirroring

b. cold site

5.

Which of the following statements is true?

a. Incremental daily backups are faster to perform than differential daily backups, but
restoration is slower and more complex.
b. Incremental daily backups are faster to perform than differential daily backups, and
restoration is faster and simpler.
c. Oi#rentil Aaity backups are faster to perform than incremental daily backups, but
"Testoration is slower and more complex.
d. Differential daily baclarps are faster to perfom than incremental daily backups, and

'
6.

restoration is faster and simpler.

Information that needs to be stored securely for 10 years or more would most likely be
stored in which type offile?

c. encrypted
d. Iog

a. backup

b. archive
7.

Which of the following is an example of the kind of batch total called a hash total?
a. the sum bf the purchase amount field in a set of purchase ordels
b. the sum ;f the purchase ordet number field in a set of purchase orders
c. the number of completed documents in a set of purchase orderc

d. all of the above

8.

Which of the following statements is true?

a. "Emergency" changes need to be documented once the ploblem is resolved'
b. ChangJs should be iested in a system sepamte ftom the one used to process transactions'
c. Change controls are necessary to maintain adequate segregation of duties'

d. All of the above

9.

10.

are

tue.

Which of the following provides detailed procedures to resolve the problems resulting
ftom a flash flood that completely destoys a company's data center?
c. business continuity plan (BCP)
a. backup plan
d. archive plan
(DRP)
recovery
b. disaster
Plan
Which of the following is

control that can be used to verify the accuracy of information

tuansmitted over a network?

a. comPleteness check

b. check digit

c. parity bit
d. size check

Discussion Questions
10.1. Two ways to create processing integrity controls in Excel spreadsheets are to use the
built-in bata Vatidation tool or to write custom code with IF statements. What are the relative advantages and disadvantages of these two approaches?

l0.2.whatisthedifferencebetweenusingcheckdigitverificationandusingavaliditycheck
to test the accuracy of an account number entered on a transaction record?

RELIABTLITY 311

312

PART

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CONTROL AND AUDIT OF ACCOL|NTING INFORMATION SYSTEMS

10.3. For each of the tbrce basic options for replacing IT infrastruchrre (cold sites, hot sites,

andreal-timemirroring),giveanexampleofanorganizationthatcouldusethatapproach
as

part of its DRP. Be PrePared to defend your eirswer'

10.4. Use the num$ers 10-19 to show why tansposition enors are always divisible by 9'
I

10.5. What are so{e business processes for which an organization might use batch processing?
10.6. Why do you lhink that surveys continue to find that a sizable percentage of organizations
either do not have formal disaster recovery and business continuity plaBs or have not
tested and revised those plans for more than a year?

Problems
10.1. Match the following terms with the appropriate definition or example:

1. Business continuity

2.

Completeness check

3. Hash total

time

b. A plan that describes how to resume IT functional-

4. Incremental daily

disaster

d. A control that counts

the number of odd or even

verify
that all data wele tansmi$ed
in
order
to
bits
correctly

backup

e. An application conlrol that testswhether

a cus-

tomer is 18 or older

6. Field check

f.

7.

Sign check

g. A

8.

Change control

h. A disaster

9. Cold site

A daily backup plan that copies all changes since

the last full backup
disaster recovery plan that.contracts for use of an
altemale site that has all necessary computing and
network equipment, plus Intemet connectivity

i.

recovery plan that contmcts for use

another company's information syslem *

of

A disaster recovery plall that conFegts for

of an

use

altemate site that is prewired for Intemet connectivity but has no computing or network equipment

c. An application control that verifies that the quantity

of

ordered is greatet than 0

5. Archive

used to store information for long periods

ity after

a. A file

plan (BCP)

10. Limit check

j.

An application control that ensures that a customer's ship-to address is entered in a sales order

11, Zero-balance test

k.

An application contol that involves

12. Recovery point

l.

An application control that involves comparing the

sum of a set of columls to the sum of a set of rows

objective (RPO)

13. Recovery time

objective (RTO)

use of an account
processing
after
not
have
a
balance
rhat shoutd

m. A measure of the length of time that an organization

is willing to function without its information system

14. Record count

n. A measure of the amounl of data that an organiza-

15. Validity check

o. A batch total

tion is willing to reenter or possibly lose in the

event of a disastff
that does not have any intrinsic

meaJnnS

16. Check digit

verification

A batch total that represents the nuTlber of tansactions processed

CHAPTER 1O

_
'

INFORMATION SYsTEMS CONTROLS FOR SYSTEMS

Atr application control that validates tlle co[ectness of one data item in a transaction record by
comparing it to the value of another data item in

17. Closed-loop
verification

-t-----

that
---- trahsaction record

,--

An application conffol that veriGes that an account

rg' Pariry checking

number entered in a transaction record matches an

accoun| number in the related master file

I
!

--l

,r.

A plan Jthar describes how to resume business operations 4fter a major calamity, such as Hurricane
Katrind, that destroys not only an organization's
data center but also its headquarte$

Reasonableness test

l
1

A data entry application conbol that verifies the

20. Financial total

accuracy of an accou[t number by recalculating the

last [umber as a function of the preceding numbers

A daily backup procedure that copies only the

21. Tumaround

activity that occurred on that particular day

document

data entry apptication control that could be used to

veriry that only numeric data are entered into a field

A plan to ensure that modifications to

an

informa-

tion system do not reduce its security

A data entry application contlol in which the system

displays the value of a data item and asks the user to
yerify that the system has accessed the correct record
v.

A batch total that represents the total dollar value

of a set of transactions
A document sellt to an external party and subsequently rctumed so that preprinted data can be
scanned mther than manually reentered.

10.2. Excel Problem

Enter the following data into a spreadsheet, and then perform the following tasks:
Employe Number

Pay

Rate

Hours Worked

12355

10.55

38

21789

2M56

11.00
95.00

3456'7

10.00

40
90
40

Gross

Pay

400.90
440.00
8550.00

400.00

Deductions

125.00
395.00
145.00
105.00

Net Pay
2'15.90

45.00
8405.00
505-00

a. Calculate examples of these batch totals:

.
.
.

A hash total
A financial total
A record count
b. Assume the following rules govem normal data:

.
.
.
.

Employee numbers are hve digits in length and range from 10000 through 99999.
Maximum pay rate is $25, and minimum is $9.

Hours worked should never exceed 40.

Deductions shouldrrcver excend 407o ofgross pay.
Give a specific example of an enor or probable error in the data set that each of the
following controls would detect:
. Field check
. Limit check
. Reasonableness test
. Cross-footing balance test
c. Create a conirol procedure that would prevent, or at least detect, each of the errors in
the data set.

RELIABILITY 313

.:
314

PART

ll .

CONTROL AND AUDTT OF ACCOUNTING INFORMATION SYSTEMS

/R

10.3. Excel koblem

The Moose Wings Cooperative Flight Club owns a number of airplanes and gliders.
It serves fewer than 2,000 members, who are numbered sequentially from the founder,
Tom Eagle (0001), to the newest memqer, Jacques Noveau (1368). Members rent the flying machines by the hour, and all must be retumed on the same day. The following six
records were among those entered for the flights taken on September 1, 2010;

Member #

t234

Flight Date
09/10/10

4ttl

Used*

Plane

ThkeoffTime

G
C

09lo,/10

Landing Time

6:25
8:49

1zto

@t01110

0023
012A
0999

09/01n0

09/01/10

1,59
12:29

ogtouto

15:31

8:46

l0:23

5t42

12i43
15i32
13i45

*C = Cessna, G Glider, L I-ear Jet, P Piper Cub

=
=
=

Required
a. Identify and describe any eEors in the data.
b. For each of the five data fields, suggest one or more input edit controls that could

c.
d.

be
used to detect input errors.
Enter the data in a sprcadsheet, and create appropriate controls to prcyent or at least
detect the input errors.
Suggest other controls to minimize the risk of input errors.

(SMAC adapted)
10.4. The fust column in Table l0-3 lists transaction amounts that have been sumned to obtain a
batch total. Assume that all data in the fust column are colrect. Cases A thro\gh D each contain an input error in one record, along with a batch total computed from that set of records.

Required
For each case (a thrcugh d), compute the difference between the corlect and erroneous
batch totals, and explain how this difference could help identify the ca\rse of the error.

TABLE

10-3 Data for Problem

Correct Transactions

Batch total

10.4
Case

Case B

Case

c;G

$3,630.62

$3,630.62

$3,630.62

$3,630.62

1,484.86

1,484.86

I,484.86

1,484.86

1,484.86

1,',123.46

1,723.46

t,'123.46

1,721.46

1,123.46

9,233.25

9,233.25

9,233.25

9,233.25

9,233.25

r23.45
't,832.44

123.45

t23.45

123.45

123.45

7,832.44

1,832.44

7,832.44

7,832.44

2,398.33

2,398.33

239A33

2,398.33

2,398.33

3,766.24

3,766.24

3,766.24

3,',766.24

3,766.24

4,400.00

4,400.00

4,400.00

-4,400.00

4,400.00

2,833.00

2,833.00

2,833.00

2,833.00

2,833.00

1,918.95

r,987.95

1,978.95

1,9'78.95

1,978.95

654.32

6s4.32

654.32

654.32

9,876.2i

9,876.23

9,876.23

9,816.23

9,8'16.23

2,138.10

2,138.10

2,138.10

2,138.10

2,138.10

5,533.99

5.533.99

5-533.99

5.533.99

5.533.99

$57,60'1.24

$5',1,616.U

$5r,6U.24

$48,807.24

$3,630.62

ise,ssz.sz

'

c"orrr*,o .

TNFoRMATToN sysrEMS coNTRoLs FoR

10.5. Excfl Problem

Create a spreadsheet with the following columns:

. Plainlext character
l. ASCtr code (seven bis, binary number)
l. F stbit
L Second bit
. Th d bit
. Fourth bit
. Fifth bit
. Sixth bit
. Seventh bit
. Number of bits with value = 1
. Parity bit for odd parity coding
. Parity bit for even parity coding

,
{

Required
a. Enter a-e, A-E, 0-9, ?,1,7o, &, arld:, in the plaintext column.
b. TIid ASCII column should conyert the plaintext chamcter to the binary

*
*
-'

code used by

your computer.
seven columns should each display one bit of the ASCII code, beginning with
the lefEnost digit. (Flilrr. Excel provides text functions that can select individual characters from a string.)
The tenthcolumn should sum the number of bits that have the value 1. (Iiinr.' The text
functions used to populate columns 3-9 retum a text stdng that you will need to con-

c. The next

d.

'

vert to a numeric value.)

e. Column 1l should

have a

I if the number in column

10 is odd, and 0

if

the number in

column 10 is even.

f.

Columll 12 should have a 1 if the number in column 10 is even, and

a0

if

the number

in coluhn 10 is odd.
10.6. The ABC Company is considering the following options for its backup plan:

l.

Daily full backups:

.
.
.

Time to perform backup = 60 minutes

Size of backup = 50 GB
Time to restore from backup = 30 minutes
2. Weekly futl backups plus daily incremental backup:
. Same requirements as option 1 to do a full backup on Friday, plus
. Time to perfom daily backup = l0 minutes
. Size of daily backup = 19 69
' . Time to restore each daily backup file = 5 minutes
3. Weekly full backups plus daily differential backup:
. Same requirements as option 1 to do a full backup on Friday, plus
. Time to perform daily backup = 10 minutes first day, growing by 5 minutes each
day thereafter
. Size of daily backup = 10 GB frrst day, growing by 10 cB each day
. Time to restore differential backup flle = 5 minutes first day, increasing by 2 minutes each subsequent day

Which approach would you recommend? Why?

'

10.7, Which control(s) would best mitigate the following threats?

a. The hours-worked freld in a payroll transaction record contained the value 400 instead
of40. As a result, the employee received a paycheck for $6,257.24 imtead of $654.32.
. b. The accounts receivable file was destroyed because it was accidentally used to update
accounts payable.
c. During processing of customer payments, tbe digit 0 in a payment of $204 was
mistakenly typed as the letter "O." As a result, the transaction was not processed

sysrEMs RELtABtLtry 311

316

PART

ll .

CONTROL AND AUDIT OF ACCOUNTING INFORMATION SYSTEMS

correctly, and the customer erroneously receiYed a letter that the account was
delinquent.
d. A salesprson mistakenly entered an online order for 50 laser pdnters instead of 50 laser
printer toner

cartridges.

e. A 20-minute power brownout

shutting down operations

f.

caused a mission-critical database server to crasU,

temporarily.

A fue deskoyed the data center, including all backup copies of the accounts redeivable

files.

g, After processing
hand for several

sales transactions, the inventory report showed a negative

quairtity on

items.

i.

an important part did not include the customer's address.

Consequently, the order was Dot shipped on time, and the customer called to complain.
Wherl entering a la.rge credit sale, the clerk typed in the customef's account number as
45982 instead of45892. That account number did not exist. The mistake was not
caught until later in the week, when the weekly billing process was run. Consequendy,

j.

A visitor to the company's Web site entered 400 chamcters into the five-digit zip code

h. A customer order for

the customer was not billed for another week, delaying receipt of Payment.

field, causing the server to crash.

representatives accessed the parts database at the same time.
Salesperson A noted that there were still 55 units of part 723 available and entered an
order for 45 of them. While salesperson A was keying in the order, salesperson B, in
another state, also noted the availability of55 units for part 723 and entered an order
for 33 of them. Both sales reps promised their customer next-day delivery. Salesperson
lls customer, however, leamed the next day that the part would have to be backordered. The customer canceled the sale and vowed to never again do business with

k. Two traveling sales

lhe company.
The wananty department marlager was upset because special discount eoupons were
mailed to every customer who had purchased the product within the patt tkee years,
instead ofto only those customers who had purchased the product within the past tfuee
months.
m. The clerk entering details about a large credit sale mistakenly typed in a
nonexistent account number. Consequently, the company never received payment
for the items.
n. A customer filled in the wrcng account mmber on the portion of the invoice being retumed

I.

with payment. Consequently, the payment was credited to another customer's accounti
sheets was sent to the payroll department for weekly processing.
Somehow, one of the time sheets did not get processed. The mistake was not catght
until payday, when one employee complained about not receiving a paycig4k.
p. Su[spot activity resulted in the loss of some data being sent to the regional ofEce. The
problem was not discovered until several days late1 when managers attemPted to
query the database for that information.

o. A batch of ?3 time

10.8. MonsterMed Inc. (MMI) is an online pharmaceutical flrm. MMI has a small systems stafl
that designs and writes MMI'S customized software. The data center is installed in the
basement of its two-story headquarte$ building. The data center is equipped with halongas fire suppression equipment and an uninteruptitlle power supply system.
The computer operations staff works a two-shift schedule, five days per week. MMI's
programming staff, located in the same building, has access to the data center and can
test new programs and program changes when the operations staff is not available.
Programmers make cha[ges in response to oral requests by employees using fie system.
Because the programming staff is small and the work demands haYe increased, systems.
and programming documentation is deyeloped only when time is available. Backups 7
are made whenever time permits. The backup files are stored in a locked cabinet in the
data center. Unfortunately, due to several days of heavy rains, MMI's building recendy
experienced serious flooditrg that destroyed not only the computer hardware but also all
the data and program files that were

on-site,

CHAPTER 1O

INFoRMATIoN SYSTEMS coNTRoLs FoR SYSTEMS RELIABILITY 317

ReqEired
a. Identify at least five weaknesses in MonsterMed Inc.'s backup
b, Evaluate change conholp ar MoDsterMed Inc.

and DRP procedures.

(CMA exan, adapted)

ld9.

ExcelProblem

Create data validation rule! in a spreadsheet to perform each of the following control!:
a- Limit check-that valu* in the cell are < 70
b. Range check-that valuls in the cell are between 15 and 65
c. Sign check-that valueslin the cell are positive

d. Field check-that values in a cell are only numeric

e. Size check-that the cell accepts no more than 40 chamcters of text
f. Reasonableness check-that the cell's value is less than 7570 of the cell to its left
g. Validity check-that a value exists in a list of allowable values
10.10. Excel Problem

EN

Creating aDd testing check digits.

reI

Required

*'

a. Crdale a spreadsheet th-at will take as input a fiye-digit account number, and calculate
'*--a check digit using this formula: (5 X left-most digit + 4 X next digit + 3 X th d
digit + 2 x fourth digit + fifth digit) modulus division by 7. (Modulus division
example: 11 modulus division by 3 = 2). The check digit
- retums the remainder-for
then becomes the sixth (righrmost) digit in the account number Your spreadsheet
should loo[< like this:
Check digits----creatiolr and use
a. Creating check

R"x
accorint#

digits
First
digit

Fomula = (5x left-most digit + 4x next digit.r 3x third digit + 2x foufth digit + fifth digit) mod 7
Second

Third

disit

digit

12350

2
2
2
2
2
2

1.2351

12352

2
2

12345

12346
1234'.1

12348
12349

1?353

Fourth
digit

Fifth
disit

Check digit

Actual

calculation

account #

4
4
4
4
4

5
5
5
5

123450
123461
123472

r23483

4
4

123494
123504

r23515

123526
123530

b.. Add another panel to the spreadsheet that takes as input a six-digit account number
and uses the check digit formula in part a to test whether or not the account number

is valid. Your solution should look like this:

b. Testing check digits

I'irst Second Third

digit digt digit

Account

tlumber

Fourth
digit

Fifth

Check Valid?

digit

disit (Y

23530Y
23534N

t23530
123534

10.11. For each of the following scenarios, determine whether the company's curent backup
procedures enable it to meet its recovery objectives, and explain why:

a. Scenario

.
.
.

1:

Recovery point objective = 24 hours

Daily backups at 3:00 A.M., process takes 2 hours
Copy of backup tapes picked up daily at 8:00 A.M. for storage off-site

318

PART

ll .

CONIROL AND AUDIT OF ACCOITNTING INFORMATIoN SYSTEMS

b. Scenario 2: Company

makes daily incremental backups Monday through Saturday at

7:00 pM. each night. Company makes full backup weekly, on Sunday at l:00 r.u.
Recovery time objective = 2 hours
Time to do full backup = 3 hours
Time to restoie from full backup = I hour
Tim6 to makq incremental daily backrip = I hour
Time to restote each incremental daily backup = 30
Scenario 3: Conflany makes daily differential backups Monday tbrcugh Friday at
8:00 r.u. each night. Company makes firll backup weekly, on Saturdays, at 8:00 A.M.
Recovery time objective = 6 hours
Time to do full backup = 4 hours
Time to restore from full backup = 3 hours
Time to do differential daily backups = t hour on Monday, increasing by 30 minutes each successive day
Time to restore differenrial daily backup = 30 minutes for Monday, increasing by
15 minutes each successive day

.
.
.
.
.
c.

minutes

'l

.
.
.
.
.

Joumal of Accountanct (avaJlable at www.aicpa.org) has

published a series of articles that address different aspects of
disaster recovery and business continuity planning:
T'he

1. J. A. Gerber and E. R. Feldman, "Is Your Business

Prepared for the Worst2" Journal of Accountancy
2O02): 61-64.

2.

(Aptil

E. McCanhy, "The Best-Laid Plansl' Iournal of

Accountancy (May 20O4): 46-54.

3. R. Myers, "Katrina's Harsh Lessons," Joarnal of

Accountancy (ltrte 2006): 54-63.
4. S. Phelan and M. Hayes, "Before the Deluge-and
After:' Joumal of Accountancy

(Apil

2003); 57-66.

Required
Read one or more

of these articles that your professor

assigns, plus section DS 4 of CoBIT version 4.1 (available at

www.isaca.org), to answer the following questions:

1. What does COBIT suggest as possible metrics for

evaluating how well an organization is achieving the
objective of DS 4? Wty do you think that metric is
useful?

For each article assigned by your professor, complete

the following table, summarizing what each article said
about a specific COBIT contlol objective (an article may
not address all l0 control obiectives inDS 4):

CHAPTER

lo .

Read section AI 6 in version 4.1 of COBIT (ayailable at www.

igaca.org), and answer the following questions:

INFORMATION SYSTEMS CONTROLS FOR SYSTEMS

l.

RELIABILITY 319

is the purpose of each detailfd control

obiective-why is it important?

Whar

is each of the suggested metrics

ACT'ON SOLUTIONS

AI5

'N

Ouiz Key
1.

*
)

$nrich of the following measures the amount of data that might be potentially lost as a
result of a system failure?
31 recovery time objective (RTO) (Incorect. The RTO measures the time that an organization may have to function witlout its information system.)
b. recovery po,int objective (RPO) (Correct. The RPO measures the time between the last
. dara backup and the occurrence of a problem.)
c. disaster recovery plan @RP) (Incorrect. A DRP specifres the procedures to rcstore IT
operations.)

d.

business continuity plan (BCP) (Incorrect. A BCP speciies the procedures to resume

busineslprocesses.)

2.
)

Which data entry application contlol would detect and prevent entry of alphabetic characters as the price of an inventory item?
a. field check (Correct. Field checks test whether data arc rumeric or alphabetic.)
b. limit check (Incorect. A limit check compares an input value against a fixed number')
c. reasonableness check (Incorrect. A reasonableness check compares two data items to
determine whether the values of both are reasonable.)
d. sign check (Incorrect. A sign check determines whether a numeric field is positive or
negative.)

3.

Which of the following controls would prevent entry of

nonexistent customer number in

a sales transaction ?

a. field check (Incorrect. A field check tests only whether

data are numeric or alpha-

betic.)

b.

> c.
d.

4.

completeness check (Incorrect. A completeness check would ensure that a customer

number was entered, but it does not test whetler the customer number exists.)
validity check (Correct. A validity check compares a customer number entered into
a ftansaction record against the customer numbers that exist in the master file or
database.)
batch total (Incorrect. A batch total is used to verifu completeness of data entry.)

Which disaster recovery strategy involves conhacting for use of a physical site to which
all necessary computing equipment will be delivered within 24 to 36 hours?
a. virtualization (Incofiect. Vinualization is a strategy to make better use of resources by
running multiple virtual machines on one physical host. It is not a disaster recovery
strategy.)

> b. cold site (Conect.)

c. hot site (Incorect. A hot site is
for use of

an infrastructure replacement strategy which contracts

physical site that contains all necessary computer and network equiPme[t.)

PART

ll .

CONTROL AND AUDIT OF ACCOUNTING INFORMATION SYSTEMS

d.

l-

5.
)

data mirroring (Incoflect. Data miroring is a fault-toleraot backup stxategy in which

the organization maintains a second data center and all ffansactions are processed on
both systems as they occur.).

Which ofthe following statements is true?

a. Incremental daily backups are faster to perform than differeitial daily backups, but
]

restoratjon is slower and more complex.

(Correcr.)

b. Incremental daily backups are faster to perform

than differefrtial daily backups, and

restoration is faster and simpler llncorrect. Incremenral daily backups produce separate backup files for each day since the last fun backup, ma+ing restoration more

complex.)

c. Differential daily backups are faster to perform

than incremental daily backups, but

restoration is slower and more complex, (Incorrect. Differential daily backups are
slower than incremental daily backups, but restoration is faster and simpler because
orfy the most recent differentiai daily backup and the last full backup files are

required.)

d. Differential daily backups are faster to perform

than incremental daily backup\, and

restoration is fastet and simpler (Incorrect. Differential daily backups are slower to
perform than incremental daily backups.)

6.

Information that needs to be stored securely for l0 years or more would most likely be
stored in which type of file?
a. backup (Incomect. Backups are for short-term storage; archives arc for long-term storage')

> b. archiYe (Correct.)

c. encrypted (Incorect. Long-term retention

uses archives,

which are usually not

encrypted.)
d. log (Incorrect. A log is part of an audit tuail.)

7.
>

8.

)
9.

Which of the following is an example of the kind of batch total called a lash total?
a. the sum of the purchase amount field in a set of purchase orders (Incorrect. This is an
example of a financial total.)
b. the sum of the purchase order number held in a set of purchase orders (Correct. The
sum of purchase order numbers has no intrinsic meaning.)
c. the number of completed documents in a set of purchase orders (lncorrect. This is an
example of a record count.)
d. all of the above (Incorect. Choices a and c are incorect.)
Which of the following statements is true?
a. "Emergency" changes need to be documented once ttle problem is resolvd. (Incorrect.
This statement is true, but so are b and c.)
b. Changes should be tested in a system separate from the one used to process tansactions. (Incorect. This statement is true, but so are a and c.)
c. Change conkols are necessary to maintail adequate segrcgation of duties. (Incorrect.
This statement is true, but so are a ard b.)
d. All of the above are true. (Correct.)
Which of the foltowing provides detailed procedures to resolve the problems resulting
from a flash flood that completely destroys a company's data center?
a. backup plan (Incorrect. Backup plans focus solely on making a duplicate copy of files
in the event that the original becomes comrpted because of hardware malfunctions,
software problems, or human error.)

b.

disaster recovery plan (DRP) (Correct. A DRP focuses on restoring an organization's

c.

business continuity plan (BCP) (Incorrect. A BCP focuses on restoring not only
all aspects business prccesses.)
archive plan (Incorrect. An archive plan deals with long-term retention of data.)

IT functionality.)

d.

I'l:but

qHAFTER

10.
--'

t0

'

INFORMATION sYsr:Ms-

coNr:ols

of information
Which of the following is a control that can be used to verify the accuracy
,.un-r-#n"d ouer a netiork?
control to onsue
completeness check (Incorect. A completeness check is a data input

a.

that all nocessarv data are entered.)

miskey'
aig{t <foc;rrecl A check digit is a data itrPut coDtrot designe$ to detect
--. t. "f,."f.
I
ing of account numbers.)
the number of
that
co{nts
control
a
communicatioDs
parity
bit
is
A
c.
p#ty
biti(Conect.
)
Lits in order to ,erity the itrtegdty of data sent and received')
i. u data input control to ensure that the amount of
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Oncoo".i. e tir"
"h"it
"trec{
ao", no, exceed the space set aside for it. Size checks are especially
duo
"n*ieil p-gru.s that accepi input from users, because they can prevent buffer

i-po*uol fo,

overflow attacks.)

FoR sYsrEMS

RELIABILITY

'21