Chart of Accounts

1. CheckPoint: Chart of Accounts

 

 

 Due Day 4 [Individual forum]

 

 Address the following:

 

 

o What is the purpose of the chart of accounts?

o Why are internal controls and audit trails important in a computerized accounting system?

A chart of accounts is a tool to give a better view of a company’s financial activities. The purpose of the chart of accounts is to ensure a steady structuring of accounts that are created in bookkeeping.

Internal controls and audit trails are important in a computerized accounting system for several reasons. First off, these controls are needed to keep employees honest. It is very easy for an accountant to fix the accounting records in order to embezzle money from a company, and it is especially easy when there are no internal controls or audits to catch discrepancies or detour potential thieves. Second off, having a good audit trail will allow future auditors to follow each transaction easier.