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Problem on segregate of duty


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#1 Boboo

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Posted 12 January 2014 - 05:07 PM

Hello All,

I am not very understand the segregation of duty. Here is what i know, as long as you segregate the authority, record keeping and custody , you will be fine.

And here is my question.

1. Can one people in charge of 2 positions in one function? Like why you segregate warehouse(custody) and shipment(custody)? They all belongs to custody and why you have to segregate them?

 

2. Is that a problem if one people in different cycles charge different function? Like one people in sales cycle in charge of shipment(custody), and the same person in charge of purchasing (authority) in inventory cycle?
 

 

Thanks for the help

 



#2 woogiboogi

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Posted 20 January 2014 - 01:12 PM

you might wanna rephrase your sentences....it's bit confusing



#3 sunlox

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Posted 08 March 2014 - 03:17 PM

Good question and I understand what you're talking about. 

The answer is, yes, one person can be in charge of two functions but you need a compensating control or involvement of the owner. You get that?

You segregate custody and shipment to prevent fraud. Shipment is actually supporting the recording function because when you ship you have to send the shipping documents to accounting so that they can update the records, and inventory control so they can reduce the inventory records.

 

Inventory control are in charge of the custody of the asset, so the shipper should not be able to ship and update the inventory records, because they might commit fraud by shipping goods to their friends, for instance. That's not the best example but you get the idea, right?

 

That also answers your question two.