Ais Final Cheat Sheet
The Control Matrix A tool designed to assist in analyzing the effectiveness of controls, PCAOB Auditing Standard Number 5 – “Effectiveness of Control Design” Establishes the criteria to be used in evaluating the controls in a particular business process Steps in Preparing a Control Matrix STEP I: Specify control goals 1. Identify the Operations Process Control Goals -Effectiveness goals -Efficiency goals -Security goals 2. Identify Information Process Control Goals -Input Goals -Update Goals Operations Process Goals: For cash receipts process, two examples are: A:Timely deposit of checks B:Comply with compensating balance agreements with the depository bank -Other possible goals of a cash receipts would be shown as goals C, D, etc. and described at the bottom of the matrix (in the matrix legend) With respect to other business processes, such as production, possible effectiveness goals are: A:Maintain customer satisfaction by finishing orders on time B:Increase market share by ensuring the highest quality of goods Operations Process Goals: Efficiency Goals Ensure that all resources used throughout the business process are being employed in the most productive manner In general, people and computers should always be included in the efficiency assessments related to accounting information systems For other business processes, such as receiving goods and supplies, efficiency goals include the productive use of equipment Operations Process Goals: Security Goals Ensure that entity resources are protected from loss, destruction, disclosure, copying, sale, or other misuse Two resources of the cash receipts process over which security must be ensured are cash and information (accounts receivable master data) Information Process Goals: Input Goals Update Goals Ensure:Update completeness (UC) Update accuracy (UA) Steps in Preparing the Control Matrix STEP II: Identify recommend control plans 1. Annotate “Present” Control Plans 2. Evaluate “Present” Control Plans 3. Identify