AIS Midterm
based on a credit relationship between the trading parties.
Expenditure Cycle
From system perspective, this transaction has two parts:
Physical Components and Financial Components
Subsystem of Expenditure Cycle:
Purchase Processing System, Cash Disbursement System
represent a general journal entry
Journal Voucher
special journal used to records all types of purchases made on account
Purchase Journal
list of outstanding a/p organized by payment due date
Open Accounts Payable File
suppliers’ account set up to recognize liability after performing the 3-way matching
Accounts Payable Sub-Ledger
list of open p.o for AP creation awaiting the receiving report
Accounts Payable Pending File
document prepared upon receipt and physical inspection of goods ordered
Receiving Report
a listing of all receiving reports prepared.
Receiving Report File
a listing of the company’s vendors/suppliers
Valid Vendor File
listing of processed purchased order, updated for received/served orders
Open/Close P.O File
formal document sent to the supplier detailing the items being ordered
Purchase Order
internal document that initiates the purchase process
Purchase Requisition
Primary Objectives of Cash Disbursement
Avoid Early Payments, Avoid Late Payments
summary of all cash disbursement voucher processed.
Voucher Register
prepared for every disbursement reflected on the voucher register.
Cash Disbursement Voucher
equivalent record of open A/P file.
Voucher Payable File
supporting documents
Voucher Packet
cash disbursement journal, special journal for all types of payment processed.
Check Register
listing of all voucher packers processed.
Close Voucher File
documents that identify employees authorized to receive a paycheck.
Personnel Action Forms
document capture the time that individual workers spend on each production job.
Job Tickets
document capture the time the employee is at work.
Time Cards
summary of charges and forwarded to the general ledger function after cost accounting allocates labor costs.
Labor Distribution Summary
listing of employees receiving payroll showing gross pay, additional pay, deductions, withholding taxes.
Payroll Register
record of an employee’s payroll breakdown per cutoff.
Employee Payroll Records
negotiable instrument that is presented to the bank for encashment of amount received as payroll.
Paycheck
cash fund account set aside for the payment of payroll only.
Payroll Imprest Account
use of the personnel action form to keep the employee records currrent.
Transaction Authorization
timekeeping function should be separate from the personnel function.
Segregation for Duties
should observe the timekeeping process and reconcile the time cards with the actual attendance.
Supervision
Payroll Processing Control
Transaction Authorization, Segregation for Duties, Supervision
Independent Verification
Verification of Time, Paymaster, Accounts Payable, General Ledger
before sending the time cards to payroll, the supervisor must verify their accuracy and sign them.
Verification of Time
to distribute chocks; helps verify the existence of the employees
Paymaster
the AP clerks verifies the accuracy of the payroll register before creating a disbursement voucher that transfers funds to the imprest account.
Accounts Payable
provides verification of the overall process by reconciling the labor distribution summary
General Ledger