Application Controls

question 84

Multiple Choice

Application controls

• A) can be classified as input controls, processing controls, and output controls.
• B) govern the design, security, and use of computer programs and the security of data files in general throughout the organization.
• C) apply to all computerized applications and consist of a combination of hardware, software, and manual procedures that create an overall control environment.
• D) include software controls, computer operations controls, and implementation controls.

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Definitions:

Zero Balance Account

A zero balance account is a type of bank account that maintains a balance of zero dollars by automatically transferring funds from a master account in the exact amount of transactions clearing the account.

Line of Credit

A flexible loan from a bank or financial institution, where a borrower can access funds up to a specified limit at any time.

Lockbox System

A service provided by banks to process payments quickly by allowing companies to have their customers send payments to a special post office box.

Disbursement Float

The time lag between when a payment is issued by a payer and when the funds are actually withdrawn from the payer's account.