Outdoor Adventure is a Montana-based wholesaler of rafting and camping equipment that serves outdoor sports camping retailers throughout the northwest. You have been hired by Outdoor Adventure to evaluate its processes, risks, and internal controls. The following paragraphs describe Outdoor Adventure’s payroll and fixed asset systems. records it in the digital check register. She sends the check to the vendor and the cash disbursement voucher to the general ledger department. The user department manager handles both asset maintenance and asset disposal. The manager adjusts the fixed asset subsidiary account balances to match asset depreciation schedules over time. When an asset reaches the end of its useful life, the manager issues a disposal report. The manager sends a fixed asset summary to the general ledger department. The general ledger department clerk reconciles the cash disbursement voucher, journal voucher, and fixed asset summary; posts to the GL accounts from the department terminal; and files the remaining documents.

Required
a. Prepare a data flow diagram of the current payroll and fixed asset systems.
b. Prepare system flowcharts for the payroll and fixed asset systems.
c. Describe the uncontrolled risks associated with these systems as they are currently designed.
d. Describe the physical and IT controls needed to reduce the risks identified in “c” above.