EM2814 | Examining Accounts: Computer Generated Records: Approach

Approach

You will need a code list for the nominal ledger account. This is a list, usually of numerical codes assigned to the various ledger accounts. This allows the computer to identify a piece of information as belonging to that ledger account.

You need to know who allocated the particular ledger codes to the items to be input into the system. Private items may be entered under a business ledger code or a capital expense included in a revenue account in the same way as it is possible to mispost such items in a paper based system. Where an original document such as for example a purchase invoice is allocated to a particular ledger it is normal practice to enter the ledger code on the original document.

Most systems provide an Audit trail. This is a chronological record of transactions. A full copy of the audit trail should show every entry into the system in date order and may be very large. For that reason you should look to obtain this electronically and examine it in conjunction with the Data Handling Specialist. Records you might like to see include

sales account ledger and invoices
purchase account ledgers and invoices
other expenditure account ledgers and invoices
proprietor’s drawings account ledgers or equivalent.

You may also be interested in lists of debtors at certain dates or after certain periods and specific ledger accounts such as closing stock. It could also be worth looking at any adjustments made at a trial balance stage or any other stage in the preparation of the accounts.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)