Question

Explain the characteristics of an edp environment

Answer 1

Answer:

Characteristics of an EDP organisational structure include:

1. Concentration of functions and knowledge—although most systems employing EDP methods will include certain manual , operations, generally the number of persons involved in the processing of financial information is significantly reduced. Furthermore, certain EDP personnel may be the only ones with a detailed knowledge of the source of data, the methods . of processing and the distribution and use of the output. It 7; is also likely that they are aware of the internal controls : present and, therefore, may be in a position to alter computer programs or data while stored or during processing. Consequently, many conventional controls based on adequate segregation of duties may not exiét or may be less efiective, constituting an additional risk that fraud and error may not be detected.
2. Concentration of data—because of the nature of computer processing, data relating to the entity may be concentrated in one department (i.e. the EDP department). Therefore, in the absence of appropriate controls, there is an increased risk of unauthorised access to, and alteration of, such data.