Analytical Review of DEVELOPMENT OF METHODOLOGY FOR COMPUTER ASSISTED INFORMATION SYSTEMS AUDITING
UNIVERSITAS INDONESIA
CASE STUDY 6
DEVELOPMENT OF METHODOLOGY FOR COMPUTER ASSISTED INFORMATION SYSTEMS AUDITING
By: Mario Žgela, M Sc
SISTEM INFORMASI DAN PENGENDALIAN INTERNAL
Chitarani Kartikadewi - 1406524682
Desi Susanti - 1406524695
Karina Ayu Ditriani - 1406524713
FAKULTAS EKONOMI
PROGRAM MAKSI-PPAK
OKTOBER 2014
CHAPTER I
SUMMARY
Analysis of Some Cases Resulting in Significant Losses or Bankruptcies
During 1990's and 2000's, there are several companies that severe bankruptcies or significant financial losses, especially banking industries. Usually, losses and bankruptcies are caused by inadequate risk control mechanisms especially in area of operational risks. To be specific, the lack of control in using information systems and computer technologies are the main reason of the losses and bankruptcies.
In certain cases inappropriate information systems management can result in such systemic domino effects. It is important to prevent domino effects in baking industry, which is one of major tasks of central banks and financial supervising and auditing authorities. Unfortunately, some recorded losses and bankruptcies were caused not only by local failures but also by macro and even global negative economic impacts.
Barings Bank Bankruptcy Case
Subject: Nick Leeson (head of front and back offices in Barings Bank Singapore branch)
Fraud: Engaged in unauthorized trading in futures and options
Assumptions for Fraud:
Motivation: Huge amount of money was at Leeson disposal
Knowledge: Leeson possessed very well knowledge on processes in front and back offices
Opportunity: Leeson was manager controlling processes in both front and back offices; he was a key person in change management of business applications supporting the trading
Access to assets: Leeson had access to financial assets through business applications.
Fraud Schemes:
Leeson gambled on the future direction of the Japanese markets. He hoped contract prices will go up in the future. In this
CASE STUDY 6
DEVELOPMENT OF METHODOLOGY FOR COMPUTER ASSISTED INFORMATION SYSTEMS AUDITING
By: Mario Žgela, M Sc
SISTEM INFORMASI DAN PENGENDALIAN INTERNAL
Chitarani Kartikadewi - 1406524682
Desi Susanti - 1406524695
Karina Ayu Ditriani - 1406524713
FAKULTAS EKONOMI
PROGRAM MAKSI-PPAK
OKTOBER 2014
CHAPTER I
SUMMARY
Analysis of Some Cases Resulting in Significant Losses or Bankruptcies
During 1990's and 2000's, there are several companies that severe bankruptcies or significant financial losses, especially banking industries. Usually, losses and bankruptcies are caused by inadequate risk control mechanisms especially in area of operational risks. To be specific, the lack of control in using information systems and computer technologies are the main reason of the losses and bankruptcies.
In certain cases inappropriate information systems management can result in such systemic domino effects. It is important to prevent domino effects in baking industry, which is one of major tasks of central banks and financial supervising and auditing authorities. Unfortunately, some recorded losses and bankruptcies were caused not only by local failures but also by macro and even global negative economic impacts.
Barings Bank Bankruptcy Case
Subject: Nick Leeson (head of front and back offices in Barings Bank Singapore branch)
Fraud: Engaged in unauthorized trading in futures and options
Assumptions for Fraud:
Motivation: Huge amount of money was at Leeson disposal
Knowledge: Leeson possessed very well knowledge on processes in front and back offices
Opportunity: Leeson was manager controlling processes in both front and back offices; he was a key person in change management of business applications supporting the trading
Access to assets: Leeson had access to financial assets through business applications.
Fraud Schemes:
Leeson gambled on the future direction of the Japanese markets. He hoped contract prices will go up in the future. In this