Accounting Information Systems: Motherboards and More Report Analysis

This report examines the revenue cycle of Motherboards and More, encompassing sales order, shipping, billing, and cash collection processes. It identifies internal control weaknesses within the revenue cycle, such as inaccurate order entries and shipping errors, and their potential impact on the company. The report also provides an overview of ransomware attacks, specifically referencing a 2017 incident. It then recommends specific controls and measures to protect Motherboards and More from future ransomware attacks, including updating software and patches, implementing anti-virus protection, and backing up data. The report concludes with recommendations for the organization to improve its security posture and prevent future cyberattacks, emphasizing the importance of data backup, patch management, and anti-virus programs.

Running head: ACCOUNTING INFORMATION SYSTEMS
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Motherboards and More report
Name:
Institution Affiliation:

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Executive Summary
This research report is based on the Motherboards and More organization. The purpose of the
report is to review on the revenue cycle of the organization as well as provide the management of
the organization with some recommendations on how to keep the company safe from the
ransomware attack following the recent case which occurred in May 2017. The research intends
to identify on the internal control weaknesses which have been encountered in the organization,
the weaknesses they have, and internal control measures to prevent from such attacks.

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Table of Contents
1. Overview of the revenue cycle..........................................................................................................4
2. The internal weaknesses of the Motherboard and More revenue cycle.............................................4
3. Overview of Ransomware attack..........................................................................................................5
Control to implement at Motherboards and More against Potential Ransomware attack..................6
Conclusion and recommendations...........................................................................................................6
References...................................................................................................................................................8

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1. Overview of the revenue cycle
Motherboard and More company revenue cycle comprise of the various activities which they
perform. These activities are highlighted as the sales order, shipping, billing and the collection of
the cash. In the sales order entry it usually comprise of the customer making an order (Romney
& Steinbart, 2012). The organization check the inventory on the availability of the merchandise
the customer has ordered and fill the order (Doyle & McVay, 2007). The organization then
creates a picking ticket to be able to make authorization on the inventory control and release on
the merchandise to the department which is involved in shipping. In the shipping department
there is usually the filling of the orders for the clients. Moreover in this department there is
picking as well as packing of the merchandises so that they would be shipped. When it comes to
the billing this is where the invoicing is done (Feng, Li & McVay, 2009). There is creation of the
document which are used for the purpose of processing of the invoice of sale to notify the client
how much they would pay for the merchandise and where they would send on the payment. The
next component of the revenue cycle is the collection of the cash (Doyle, Ge & McVay, 2007).
The finance officer in the organization usually handles the remittance of the customer and they
make the deposits to the bank. The remittances usually contains the information of the name as
well as the amount of money the customer has sent to the receivable account.
2. The internal weaknesses of the Motherboard and More revenue cycle.
The internal weaknesses in
revenue cycle
Effect of the weaknesses to
the company.
The specific Internal
controls to be implemented
in Motherboard and More
company.
a) There is the issue of
the sales order where
 The organization may
incur the carrying costs
 To resolve on the issue
the organization needs

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there is inaccurate
order of the clients
(Feng, Li & McVay,
2009).
which will be
encountered when the
orders are returned
(Hylas & Ashton,
1982).
to check and edit on
their data entry.
 There should be
accurate record of the
customer orders.
b) There are shipping
errors encountered in
the organization.
Wrong good are sent to
the customers.
 The organization could
incur a lot of losses
which are associated
with the shipping costs
especially when the
clients returns the
products to get the
right order they had
ordered previously.
 The organization needs
to reconcile of the
orders for sales with
the picking ticket as
well as the slip for
packing.
 The organization needs
to restrict physical
access to the inventory
to prevent
unauthorized access to
individuals.
3. Overview of Ransomware attack.
This was an attack which was designed to spread very quickly among the computers which are
on the same network and it encrypt the files through use of a strong encryption, which enables
the attackers to demand a ransom from the users to enable them decrypt the files (Doyle, Ge &
McVay, 2007). This attack was effective against the computers that had the Microsoft window
and did not have the security patch (Formby, Durbha & Beyah, 2017). The attackers demanded

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three hundred dollars and this amount was to increase after 2 hours (Bangs, 2014). There were
many nations which had been hit by this cyber extortion attack particularly the hospitals,
organizations and government.
Control to implement at Motherboards and More against Potential Ransomware attack.
Motherboards and More organization should ensure they update and patches have been applied.
The information technology departments should provide updates and the patches to the devices
as well as technology for the company (Lin, Hwang & Becker, 2003). The company should test
the security scanning system to make sure they are picking on the rogue devices which are
connected to the network.
The company should check on the Anti-virus protections: The anti-virus software is an important
part when it comes to the ransomware defense (Luo & Liao, 2007). The organization needs to
install all the necessary equipment. Moreover, it should buy the right tool and deploy it (Bangs,
2014).
On the preventive control it is important to have an effective passwords to the computers of the
organization to ensure that all the system. It is also important to coach the members not to
divulge passwords to the potential hackers.
Conclusion and recommendations
Based on the assessment which I have done some of the recommendation which the organization
need to undertake are as follows; one of the major one is the backup of the files. The greatest
damage to which the company suffers is when they lose their data from the attackers. There is
need to always back up their data through external devices which have not been connected to the
internet as the attackers use the internet to carry out their attack. Another important way they can
prevent a ransomware attack use patch programs which have been updated from the software of

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the vendors. This will enable the attack to exploit on the vulnerabilities such was the case of this
ransomware attack which target the computers which did not have patches updates for the
Microsoft program. Another recommendation which is a control measure would be to use of the
anti-virus program. The use of these program are able to stop the ransomware from being
downloaded to the systems.
In summary, in this report it has presented an overview of the revenue cycle, its components, and
the weakness to the internal control. Some of the weaknesses are on the sales order where the
organization has inaccurately entered their order wrongly as well as shipping of the wrong
merchandise to the customers. The report has provided the control measures for the weaknesses
as well as those for preventing ransomware attacks.
References

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Bangs, G. (2014). New Ransomware and Cyber extortion Schemes Hold Businesses Hostage.
Risk Management, 61(8), 30.
Doyle, J., Ge, W., & McVay, S. (2007). Determinants of weaknesses in internal control over
financial reporting. Journal of accounting and Economics, 44(1), 193-223.
Feng, M., Li, C., & McVay, S. (2009). Internal control and management guidance. Journal of
Accounting and Economics, 48(2), 190-209.
Formby, D., Durbha, S., & Beyah, R. (2017). Out of control: Ransomware for industrial control
systems.
Hylas, R. E., & Ashton, R. H. (1982). Audit detection of financial statement errors. Accounting
Review, 751-765.
Lin, J. W., Hwang, M. I., & Becker, J. D. (2003). A fuzzy neural network for assessing the risk
of fraudulent financial reporting. Managerial Auditing Journal, 18(8), 657-665.
Luo, X., & Liao, Q. (2007). Awareness education as the key to ransomware prevention.
Information Systems Security, 16(4), 195-202.
Romney, M. B., & Steinbart, P. J. (2012). Accounting information systems. Boston: Pearson.