Kudler Fine Foods
Controls and Risk Evaluations
Stacey Richard
ACCT 542
March 19, 2012
Professor Highwart
Controls and Risk Evaluations
In previous reports provided to Kudler Fine Foods, the company addressed several issues. First was how implementing AIS would improve operations, next was how the use of flowcharts showed connections between reportable accounts, and last was how the use of pivot tables could increase decision making. This report will address risks including internal control measures.
Analysis of Risks
Although, there are many risks associated with AIS implementation, Kudler Fine Foods must focus on business risks, security risks, audit risks, and continuity risks (Hunton, Bryant, & Bagranoff, 2004, pg. 48). This determination was made because measures need to be taken for evaluation of risks and controls for efficiency and effectiveness on a continual basis.
The first risk, business risk, includes threats associated with the lack of a company to achieve its goals and objectives (Hunton, Bryant, & Bagranoff, 2004, pg. 48). Some measures to address risks and controls first must take place in the company. This means that the company must have continuity measures in place to address the likelihood of things such as failures in equipment. The company must also contend with the possibility of fraudulant activity occuring on the systems.
Next security risks, is the assurance that unauthorized personnel will not have access to vital information. For internal control measures to be effective the company must have internal controls to reduce unauthorized system access. Next are audit risks which contribute to the authenticity of the system chosen. Audit risk carries with it several subcomponents of various risks, such as inherant, control, and detection risks (Hunton, Bryant, & Bagranoff, 2004). Similar to business risk, the opportunity for fraudulant activity to occur contributes significantly to control risk. An auditors failure to uncover
Stacey Richard
ACCT 542
March 19, 2012
Professor Highwart
Controls and Risk Evaluations
In previous reports provided to Kudler Fine Foods, the company addressed several issues. First was how implementing AIS would improve operations, next was how the use of flowcharts showed connections between reportable accounts, and last was how the use of pivot tables could increase decision making. This report will address risks including internal control measures.
Analysis of Risks
Although, there are many risks associated with AIS implementation, Kudler Fine Foods must focus on business risks, security risks, audit risks, and continuity risks (Hunton, Bryant, & Bagranoff, 2004, pg. 48). This determination was made because measures need to be taken for evaluation of risks and controls for efficiency and effectiveness on a continual basis.
The first risk, business risk, includes threats associated with the lack of a company to achieve its goals and objectives (Hunton, Bryant, & Bagranoff, 2004, pg. 48). Some measures to address risks and controls first must take place in the company. This means that the company must have continuity measures in place to address the likelihood of things such as failures in equipment. The company must also contend with the possibility of fraudulant activity occuring on the systems.
Next security risks, is the assurance that unauthorized personnel will not have access to vital information. For internal control measures to be effective the company must have internal controls to reduce unauthorized system access. Next are audit risks which contribute to the authenticity of the system chosen. Audit risk carries with it several subcomponents of various risks, such as inherant, control, and detection risks (Hunton, Bryant, & Bagranoff, 2004). Similar to business risk, the opportunity for fraudulant activity to occur contributes significantly to control risk. An auditors failure to uncover
References: Ex-Sight.Com. (n.d.). What is "Biometrics", and What Kind of Convenience and Security Can it Offer Us. Retrieved March 18, 2012, from Ex-Sight. Com: www.ex-sight.com/biometric.htm Hunton, J., Bryant, S., & Bagranoff, N. (2004). Core Concepts of Information Technology Auditing. New Jersey: Wiley. Myers, J. (2010, June). Benefits of an Effective Internal Control Environment. Retrieved March 18, 2012, from BKD, CPA 's and Advisors: www. bkd.com