1. Audit of the Revenue Cycle
CAS 265 – Communicating deficiencies in internal control to those charged with governance and management
CAS 300 – Planning an audit of financial statements
CAS 315 – Identifying and Assessing the Risks of Material Misstatement through Understanding the Entity and its Environment
CAS Materiality in Planning and Performing an Audit
CAS The Auditor’s Response to Assessed Risk
CAS 500 – Audit Evidence
CAS 530 – Audit Sampling

2. Risk Assessment
Must understand the entities method of generating revenues in order to assess the business risk and risk of misstatement. Thus: Also:

3. Typical Transactions in the Sales and Collection Cycle
Five major classes of Transactions:
Sales
Cash receipts – collecting and depositing
Sales returns and allowances
Technically two distinct transactions
The write-off of uncollectible accounts
Bad-debt expense

4. Typical Activities
See the following slides Receiving and processing customer orders. Delivering goods and services to customers. Billing customers and accounting for receivables. Collecting and depositing cash. Reconciling bank accounts.
LO1

5. Revenue and Collection Process
Start Here
Customer Orders
Collections
Revenue Cycle
Bill Customers
Credit Granting
Warehousing, Shipping, and Delivery
LO1

6. An Overview of Functions, Documents, and Accounting Systems
Order Entry Department
The starting point
= Good control point
Signed by the customer, except for telephone or internet orders.
By phone, internet or mail
Customer Purchase, or Contracts
Prepare Sales Order
Sales Order 1
Customer 2 3
Credit Department
Credit Granting
Credit Manager signs the sales order for credit approval A

7. Okra Development Corp. Copy
8924 Bailey Road Purchase Order
Salem, OR Date: August 5, 201X
Ship By: September 12, 201X
Terms: 2/10, n/30
FOB Shipping Point
To: Ship to:
Faragut Sales, Inc. Okra Development Corp.
3812 Briar Drive Bailey Road,
Salem, OR Salem, OR 92117
Quantity 10
Number
Model 317
Price
48.00
Amount
480.00
Description
Roller Bearing for
Model 3118 Ripper
Purchase order number must appear
on all shipments and invoices Ordered By
Margaret Spangler

8. Prenumbered Sales Order. Controlled numerically10
Model 317
Roller Bearing
480.00
Date shipped: 8/20/20XX Freight Bill #
Sales Order
64412
To:
Okra Development Corp.
8924 Bailey Road
Salem, OR 92117
Ship by September 12, 20XX
Terms: 2/10, n/30
FOB Shipping Point
Credit Approval___________
Goods Counted ___________
Customer Order Number
Faragut Sales, Inc.
Ship to Okra Development
8924 Bailey Road, OR
C.H.
M.K.
Copy
Prenumbered Sales Order. Controlled numerically

9. Shipping involves the Warehouse , Shipping, & Delivery
Approved Sales Order
Sales Order
Bill of Lading
Prepare Multi-Part Bill of Lading N
Approved by Credit Manager.
A legal document that the carrier is required to have.
Always useful to have a numerical file. Kept in Shipping. Dept.
Order Entry
Billing and A/R
Common Carrier
Customer

10. Description of Articles,
BILL OF LADING
Faragut Sales, Inc.
3812 Briar Drive
Salem, OR August 20, 201X
Shipp to: Okra Development Corp.
Destination: 8924 Bailey Road, Salem, OR 92117
Carrier: Yellow Express Car Initial: Car No.
Copy
Prenumbered Bill of Lading. Controlled numerically
Number of
Packages 5
Description of Articles,
Special Marks, and Exceptions
Roller Bearings, 2 each
Weight
28 lbs.
Class or
Rate 3
Faragut Sales Shipper, Per Joe Chen Agent Yellow Express Per Sue Jones

11. Sales Order & Bill of Lading goes to Billing/Accounts Receivable Department
Pricing checked. Account coding checked.
A numerical file that shows approval of the sale, proof of shipment, and billing. Good for testing internal controls.
Shipping Department
Sales Order
Bill of Lading
Sales Order
Authorized Price List
Bill of Lading
Invoice N
Invoice
Invoice
Prepare Sales Invoice & Sales Summary
Cost Department for Perpetual Inventory
Invoice
Customer
Summary by invoice number.
Sales Summary
General Accounting

12. We are pleased to serve you
Faragut Sales, Inc D Copy
3812 Briar Drive, Salem, OR 92115
Sales Invoice
Sold Shipped to Freight Bill No.
Okra Development Corp Bailey Road
8924 Bailey Road Salem, OR 92117
Salem, OR 92117
FOB Shipping Point
Prenumbered Sales Invoice. Controlled numerically
Invoice Date
August 25, 20XX
Date Shipped
August 25, 20XX
Terms
2/10, n/30
Your Order No.
6-3378
Quantity
We are pleased to serve you
Price
Amount
10 Model
Key controls. Initials are evidence of control being performed. In total or sample.
Pricing and Math J.D.
Account Coding S.A.L.

13. Page 327
SALES JOURNAL
Date
Sold to:
Invoice No:
Amount
August 25
Okra Development Corp.
D8-9912

14. Prepare List of Cash Received (2 copies)
Cash Collection
Receptionist/Mail Room Clerk
Deposits prepared by a person separate from the one who opens the mail.
Customer
Remittance Advice
Invoice Copy
Remittance Advice
Cheque
Invoice
Cheque
List
Prepare List of Cash Received (2 copies)
Cashier
Control Copy to General Accounting
Two separate listing going to two different places for later cross checking

15. Notice the complete details on the Remittance Advice
Okra Development Corp.
Salem, OR
REMITTANCE ADVICE
Invoice No.
Date
Voucher
Gross Amount
Discount
Net Amount
D8-9912
8-25-XX
480.00
9.60
470.40
Cheque No.
Vendor No.
Vendor Name
Total Amount
867
9-04-XX
Faragut Sales, Inc.
If the remittance advice is not returned, the person opening the mail should prepare one so that each cheque received is represented by a remittance advice complete with all pertinent details.

16. Also called a pre-listing of cash receipts
15642
September 5, 201X
Cash Receipts Listing
Fountain City Warehouse x,400.00
Charlotte Sawyers, Inc. x,295.00
Brown, Inc. 1,200.00
Okra Development Corp. x,470.40
Toil Incorporated x,490.00
Harreleson Hardware 1,872.80
Barnaby Sales, Inc. x,982.00
Hartfords x,x92.00
5,802.20
Preparer
J.T.Lockett
Cash Summary
Cash Receipts Listing 5,802.20
Over-the-counter cash receipts 3,130.40
8,932.60
x,120.00
x,x98.32
x,x23.66
x,842.33
x,988.11
3,130.40
Adding Machine Tape
Also called a pre-listing of cash receipts
All cash receipts should be listed on the pre-listing from the remittance advices.

17. Cash must be deposited in the Bank Cashier
Once again, a separate dept.
Remittance Advice
Prepare Deposit Slip & Cash Receipts Summary
List of Receipts
Invoice Copies
Cheques
Mail Clerk
CR Summary
Deposit Slip
General Accounting
A/R to update A/R Sub-Ledger
Bank
Remittance Advice
Distribution going to separate depts. For reconciliation
All cash receipts should be deposited daily

18. Prepared by cashier, separate from the receipt of cash by Receptionist
First National Bank
Faragut Sales, Inc.
Deposit Slip
September 5, 201X
Prepared by cashier, separate from the receipt of cash by Receptionist
3,130.40
400.00
295.00
1,200.00
470.00
490.00
1,872.80
982.00
92.00
$8,932.60
Currency
Cheques
Teller 5
Initialed by cashier
P.L.

19. Page 112 CASH RECEIPTS JOURNAL
Date Customer Name Cash Sales Account Receivable
Discount Credit
August 25 Okra Development Corp

20. The Accounts Receivable Sub-Ledger must be updated A/R Department
Bank
Duplicate Deposit Slip
Cashier
Notice that the posting to the accounts is separate from collection of cash, and deposit in the bank.
Remittance Advice
List of Receipts
Cash Receipts Summary
Subsidiary customer accounts posted from remittance advices.
Trial Balance
Trial Balance
Post to the Customer Accounts & Prepare Trial Balance D
General Accounting for comparison to the G/L
Daily remittance list compared to duplicate deposit slip received from bank by person independent of either function.

21. The Role of General Accounting
Post to the general ledger using data obtained from other depts.
Subsidiary customer accounts posted from remittance advices.
Post to the General Ledger
Sales Summary
A/R Dept.
List of Receipts
CR Summary
Mail Clerk
Cashier
There should be a monthly reconciliation of control account to customers' individual accounts and bank statement reconciled promptly.

22. Typical Documents and Records
Sale is initiated with a
What documents accompany the sale?
Routine reports
include a sales journal
aged accounts receivable trial balance
Anything else?

23. The Accounts of the Sales and Collection Cycle
Gross
sales
Cash
Sales
Sales on
Account
Accounts receivable
Cash receipts
Sales returns and allowances
Charge-off of uncollectible accounts
Beginning balance
Sales on account
Ending balance
Allowance for uncollectible accounts
Bad debts
Charge off of uncollectible accounts
Cash in bank
Cash discounts taken

24. Methods of Recording Transactions
Manual recording
Recorded one transaction at a time

25. Control Differences Between Manual and Online Systems
Manual systems:
Transactions readily traced
Online systems:
Transactions recorded one at a time
Document sequencing is important

26. Control Differences For Error Detection and Correction
Manual systems:
An erroneous transaction
Error follow-up should be done in a timely manner
Online systems:
Focus is on preventing errors
Input edit check for valid customer data and reasonableness

27. Manual and Online Systems: Segregation of Duties
Manual systems:
Separate
Reconciliation and error follow-up
Online systems:
In decentralized systems
Use passwords to separate

28. Risk Assessment and the Sales Cycle
Why do risk assessment?
Risk Type
Impact upon Sales and Collection Cycle
Client business risk
Increased client business risk could lead to greater risks of misstatement of sales.
Audit risk
As audit risk decreases, the level of assurance required increases, and the extent of testing required increases.
Inherent risk - overall
As inherent risk increases, the extent of testing required increases; inherent risks associated with the handling of cash directly affect certain audit assertions in sales (e.g. completeness).
Risk of material misstatement - overall
Management biases due to bonus incentives or stated earnings forecasts could increase the extent of testing.
Risk of fraud - overall
Poor fraud risk management could result in increased risk of fraud, with a need to increase the extent of testing.
Identify significant risks
Revenue recognition is considered a significant risk unless the auditor has evidence to the contrary; this means that controls over revenue recognition need to be assessed and increased testing is required of assertions that affect revenue recognition.
Remember that as risk increases

29. Effect of General Controls
Are pervasive and affect multiple transaction cycles
Typical examples of general controls

30. If general controls are good,
the auditor may be able to rely upon them
If general controls are poor

31. Methodology for Designing Tests of Controls for Sales
Understand general controls - sales
Understand internal control and evaluate design effectiveness - sales
Assess planned control risk; identify and assess risks of material misstatement - sales
Evaluate cost-benefit of testing controls
Design tests of controls for sales to meet transaction-related audit objectives
Audit procedures
Sample size
Items to select
Timing
By assertion:

32. Documentation of Internal Controls
Internal controls need to be documented
The auditor focuses on
What type of controls can these be?

33. Key Controls for Sales Segregation of Duties Authorization
requires that different individuals be assigned responsibility for different elements of related activities, particularly those involving authorization, custody, or recordkeeping.
Authorization
Proper authorization of transactions and activities helps ensure that all company activities adhere to established guide lines unless responsible managers authorize another course of action.
Documents and Records
Adequate documents and records provide evidence that financial statements are accurate.

34. Internal verification
Prenumbered documents
Monthly statements
Periodic reconciliation

35. Application Controls These are computer internal controls
Edit checks for key fields can be verified by classifying the transactions on the values for the field.

36. Tests of Internal Controls
Once the key controls have been identified, the auditor can decide
Tests of internal controls will be devised for

37. Examples of Internal Control using the Occurrence Assertion
Manual Control
Key control: credit is approved before shipment takes place.
The manual control?
Possible test of control

38. Automated Online
Occurrence assertion
Key control: Orders causing balances to exceed credit limits are held in a separate transaction file
Possible test of control:

39. Interdependent
Occurrence Assertion
Key control: Orders causing balances to exceed the credit limit are printed on an exception report and must be approved by a credit manager
Possible test of control:

40. Manual, Automated and Interdependent Controls
From the previous examples, it can be seen that:
Manual controls are controls performed entirely by people
Automated controls (batch or online) are performed only by computerized systems
Interdependent controls rely upon computer processes (automation) but a person must also be involved to fully perform the control

41. Direction of Testing
Tracing
Vouching

42. Tracing Vouching Goes from the start of the transaction to the posting
Is this a test for overstatement or understatement of sales?
Vouching
Goes from the general ledger or sales journal back to the original document

43. Typical Concerns for Tests of Sales
Recorded sales occurred
Occurrence –
Auditor is concerned with following possible misstatements
Recorded sale for which there was no shipment
Sale recorded more than once
Shipment made to non-existent customer

44. Existing sales transactions are recorded
Completeness assertion
Want to test for unbilled shipments
Are shipping documents complete?
Recorded Sales are accurately recorded
Measurement assertion

45. Recorded sales are properly classified
Ensure correct entry into the general ledger
Sales transactions are properly updated in the master file and correctly summarized
Accuracy of the master file is essential
Sales are recorded on the correct dates
Sales must be billed as soon as shipment takes place
Remember all the tests can be dome with the same sample of sales invoices and shipping documents

46. Typical Controls and Tests for Cash Receipts
Transaction-Related Audit Objective
Key Internal Control
General Tests of Controls
Quantitative/Dual-Purpose Test of Controls
Recorded cash receipts are for funds actually received by the company (occurrence)
Separation of duties between handling cash and record keeping or data entry
Independent reconciliation or review of bank accounts.
Observe separation of duties.
Observe independent reconciliation of bank account.
Review the cash receipt journal, general ledger, and accounts receivable master file or trial balance for large and unusual amounts.
Trace from cash receipts listing to duplicate deposit slip and bank statements
Cash received is recorded in the cash receipts journal (completeness).
Separation of duties between handling cash and record keeping.
Use of remittance advices or a prelisting of cash.
Immediate endorsement of incoming cheques.
Internal verification of the recording of cash receipts.
Regular monthly statements to customers.
Discussion with personnel and observation.
As above.
Observe immediate endorsement of incoming cheques.
Examine indication of internal verification.
Observe whether monthly statements are sent to customers.
Trace from remittances or prelisting to duplicate bank deposit slip and cash receipts journal.
Review reconciliation reports of credit card or electronic funds transfer receipts.
Cash receipts are deposited and recorded at the amount received (accuracy).
Approval of cash discounts.
Regular reconciliation of bank accounts.
Comparison of batch totals with duplicate deposit slips and computer summary reports.
Examine remittance advices for proper approval.
Review monthly bank reconciliations.
Examine file of batch totals for initials of data control clerk; compare totals with summary reports.
Examine remittance advices and sales invoices to determine whether discounts allowed are consistent with company policy.
Cash receipts are properly classified (classification).
Use of adequate chart of accounts or automatic posting to specified accounts.
Review chart of accounts and computer-assigned posting accounts.
Examine documents supporting cash receipts for proper classification.
Cash receipts are properly included in the customer master file and are correctly summarized (posting and summarization).
Use of properly approved master file change forms.
Comparison of customer master file or aged accounts receivable trial balance totals with general ledger balance.
Observe whether statements are mailed.
Examine master file change forms for proper authorization.
Examine documentation verifying that comparison was complete,
Foot journals, and trace postings to general ledger and accounts receivable master file.
Cash receipts are recorded on correct dates (timing).
Procedure requiring recording of cash receipts on a daily basis.
Observe unrecorded cash at any point in time.
Compare dates of deposits with dates in the cash receipts journal.

47. Frequency of Testing of Internal Controls
Is an auditor allowed to use the results of prior testing in a current audit?
In this case, which type of controls must be tested annually?
Which type of controls could potentially be tested every three years?

48. Testing of Interdependent Controls
The interdependent control has two parts:
A function performed
It is only possible to rely upon the automated function if:
Both parts of the control must be tested to enable

49. What if Control Testing Yielded Many Errors?
The first step is to determine whether the errors or exceptions
were due to a particular circumstance
or restricted to a particular time period

50. If the errors are systemic
If this alternative control achieves the same purpose and is functioning correctly
If no compensating control?

51. Material Error If there is no compensating control
Want to quantify the extent of the error.

52. Results of Quantifying the Error
If it turns out that the results of the weakness could result in immaterial error
If a material error could result

53. Communicating Deficiencies in Internal Control (CAS 265)
Communicate to those charged with governance and management Those deficiencies in internal control identified by the auditor The auditor shall include a written communication of th significant deficiencies

54. Performing the Audit Program
The initial audit program is organized by audit assertion
In performing for maximum efficiency
The use of automated working paper software facilitates this process.

55. Computer-Assisted Audit Tests
Where there are a large number of transactions
E.g. In internal controls testing, the auditor could use automated sampling routines

56. Suitability of Test Data
Online systems
Test data is useful

57. Suitability of Generalized Audit Software
Best suited for analytical review, tests of detail, or dual-purpose tests, for example:

58. Problem DC 10-2, Page 547 1 2 3 4 5 6 TER (in percentage) 8 20 15
The following are auditor judgments and audit sampling results for six populations. Assume large population sizes. 1 2 3 4 5 6
TER (in percentage) 8 20 15
ARACR (in percentage) 10
Actual sample size
100 60
Actual number of exceptions in the sample
REQUIRED
For each population, did the auditor select a smaller sample size than is indicated by using attribute sampling tables for determining sample size? (Assume K=0 in sample size planning). Evaluate, selecting either a larger or smaller size than those determined in the tables.
Calculate Sample Deviation Rate (SDR) and Upper Error Limit (UEL) for each population.
For which of the six populations should the sample results be considered unacceptable? What options are available to the auditor?
Why is analysis of the exceptions necessary even when the populations are considered acceptable?
For the following terms, identify which is an audit decision, which is a non-statistical estimate made by the auditor, which is a sample result, and which is a statistical conclusion about the population.
Estimated population deviation rate.
Tolerable deviation rate.
Acceptable risk of overreliance on internal control.
Actual sample size.
Actual number of deviations in the sample.
Sample deviation rate.
Achieved P or UEL

59. Confidence Factors for MUS Sample Size Design (ARIA in brackets)
Number of Errors (K)
Confidence Factors for MUS Sample Size Design (ARIA in brackets)
99%
(1%)
97.5%
(2.5%)
95%
(5%)
90%
(10%)
85%
(15%)
80%
(20%)
75%
(25%)
4.51
3.69
3.00
2.31
1.90
1.61
1.39 1
6.64
5.58
4.75
3.89
3.38
2.70 2
8.41
7.23
6.30
5.33
4.73
4.28
3.93 3
10.05
8.77
7.76
6.69
6.02
5.52
5.11 4
11.61
10.25
9.16
8.00
7.27
6.73
6.28 5
13.11
11.67
10.52
9.28
8.50
7.91
7.43 6
14.58
13.06
11.85
10.54
9.71
9.08
8.56 7
16.00
14.43
13.15
11.78
10.90
10.24
9.69 8
17.41
15.77
14.44
13.00
12.08
11.38
10.81 9
18.79
17.09
15.71
14.21
13.25
12.52
11.92 10
20.15
18.40
16.97
15.41
14.42
13.66
13.03

60. ACTUAL NUMBER OF DEVIATIONS FOUND
Sample size
ACTUAL NUMBER OF DEVIATIONS FOUND 1 2 3 4 5 6 7 8 9 10
5 PERCENT RISK OF OVER RELIANCE (RIA or Beta Risk) 20
14.0
21.7
28.3
34.4
40.2
45.6
50.8
55.9
60.7
65.4
69.9 25
11.3
17.7
23.2
28.2
33.0
37.6
42.0
46.3
50.4
54.4
58.4 30
9.6
14.9
19.6
23.9
28.0
31.9
35.8
39.4
43.0
46.6
50.0 35
8.3
12.9
17.0
20.7
24.3
27.8
31.1
37.5
40.6
43.7 40
7.3
11.4
15.0
18.3
21.5
24.6
27.5
30.4
33.3
36.0
38.8 45
6.5
10.2
13.4
16.4
19.2
22.0
24.7
27.3
29.8
32.4
34.8 50
5.9
9.2
12.1
14.8
17.4
19.9
22.4
27.1
29.4
31.6 55
5.4
8.4
11.1
13.5
15.9
18.2
20.5
22.6
24.8
26.9
28.9 60
4.9
7.7
12.5
14.7
16.8
18.8
20.8
22.8
26.7 65
4.6
7.1
9.4
11.5
13.6
15.5
17.5
19.3
21.2
23.0 70
4.2
6.6
8.8
10.8
12.7
14.5
16.3
18.0
19.7
21.4
23.1 75
4.0
6.2
8.2
10.1
11.8
15.2
16.9
18.5
20.1
21.6 80
3.7
5.8
9.5
14.3
18.9
20.3 90
3.3
5.2
6.9
9.9
12.8
14.2
100
3.0
4.7
7.6
9.0
10.3
125
2.4
3.8
5.0
6.1
7.2
9.3
12.3
13.2
150
2.0
3.2
5.1
6.0
7.8
8.6
200
1.5
3.9
300
1.0
1.6
2.1
2.6
3.1
3.5
4.4
4.8
5.6
400
0.8
1.2
2.3
2.7
3.6
4.3
500
0.6
1.3
1.9
2.9
3.4

61. ACTUAL NUMBER OF DEVIATIONS FOUND
Sample size
ACTUAL NUMBER OF DEVIATIONS FOUND 1 2 3 4 5 6 7 8 9 10
10 % Risk of Incorrect Acceptance (RIA or Beta Risk) 20
10.9
18.1
24.5
30.5
36.1
41.5
46.8
51.9
56.8
61.6
66.2 25
8.8
14.7
20.0
24.9
29.5
34.0
38.4
42.6
50.8
54.8 30
7.4
12.4
16.8
21.0
28.8
32.5
36.2
39.7
43.2
46.7 35
6.4
10.7
14.5
18.2
21.6
28.2
31.4
34.5
37.6
40.6 40
5.6
9.4
12.8
16.0
19.0
22.0
27.7
33.2
35.9 45
5.0
8.4
11.4
14.3
17.0
19.7
22.3
24.8
27.3
29.8
32.2 50
4.6
7.6
10.3
12.9
15.4
17.8
20.2
22.5
24.7
27.0
29.2 55
4.2
6.9
11.8
14.1
16.3
18.4
20.5
22.6
24.6
26.7 60
3.8
8.7
10.8
15.0
16.9
18.9
20.8
22.7 65
3.5
5.9
8.0
10.0
12.0
13.9
15.7
17.5
19.3
22.8 70
3.3
5.5
7.5
9.3
11.1
14.6
18.0
19.6
21.2 75
3.1
5.1
7.0
10.4
12.1
13.7
15.2
18.3
19.8 80
2.9
4.8
6.6
8.2
9.8
11.3
15.8
17.2
18.7 90
2.6
4.3
7.3
10.1
11.5
16.7
100
2.3
3.9
5.3
7.9
9.1
12.7
125
1.9
6.3
8.3
10.2
11.2
150
1.6
3.6
4.4
6.1
7.8
8.6
200
1.2
2.0
2.7
3.4
4.0
6.5
7.1
300
0.8
1.3
1.8
4.7
400
0.6
1.0
1.4
1.7
2.4
3.0
500
0.5
1.1
2.1

62. Problem DC 11-4, Page 612 Control Weakness: Shipping and Billing:
Ajax Inc. recently implemented a new accounting system to process the shipping, billing, and accounts receivable records more efficiently. During the interim work of Ajax’s auditors an assistant completed the review of the accounting system and the internal controls. The assistant determined the following information concerning the computer systems and the processing and control of shipping notices and customer invoices.
The computer system documentation consists of the following items: program listings, error listings, logs, and database dictionaries. The system and documentation are maintained by the IT administrator. To increase efficiency, batch totals, and processing controls are not used in the system.
Ajax ships its product directly from two warehouses, which forward shipping invoices to general accounting. There, the billing clerk enters the price of the item and accounts for the numerical sequence of the shipping notices. The billing clerk also manually prepares daily adding machines tapes of the units shipped and the sales amounts. The computer processing output consists of the following:
A three-copy invoice that is forwarded to the billing clerk
A daily sales register showing the aggregate total of units shipped and sales amounts that the billing clerk compares with the adding machine tapes
The billing clerk mails two copies of each invoice to the customer and retains the third copy in an open invoice file that serves as detailed accounts receivable record.
Required:
Prepare a list of weaknesses in internal control (manual and computer), and for ,each weakness make one or more recommendations.
Suggest how Ajax’s computer processing over shipping and billing could be improved through the use of remote terminals to enter shipping notices. Describe appropriate controls for such an online data entry system.