Chart Of Accounts

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What is the purpose of the chart of accounts? The chart of accounts are a listing of all individual accounts included in the general ledger. The chart of accounts is used to connect the general ledger numbers with other information that pertains to it. This might include account names, coded account numbers that an accountant might assign to classify a transaction; it could also have a description of the account. The chart of accounts is what defines the general ledger. The chart accounts are organized in a special order, normally the balance sheet accounts go first then income statement accounts. · Why are internal controls and audit trails important in a computerized accounting system? Internal controls are important in a computerized accounting system because computer sometimes crash and they information is lost. Computers should have some form of operating system where the information is backed up every day or periodically. This is done so the information is always available or restored accurately regardless of a computer crash. This information should be done and the backup should not be kept in the same office just in case of a fire or other incident. All computers used in the accounting should have passwords that are not easy for others to remember. Audit trails are important in a computerized accounting because they should be easily traced from all transactions. They should be able to be traced from the original source of entry into the system from all system processing. Audit trails should also be able to identify who did the transactions. This is important so the will be no security violations in the system. Audit trails will give the auditor a valuable way to obtain information about the activity done on the computer

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