Q.What do you mean by data security in a computerised accounting environment? Explain the common controls used to protect accounting data.

Data security means the measures taken to prevent a business's accounting data from being lost, corrupted or accessed by someone not authorised to see it.

Data security, in a computerised accounting environment, means the set of measures taken to prevent accidental loss, deliberate tampering, or unauthorised viewing of a business's accounting data. Because the entire financial history of a business can be stored electronically, a single security lapse can have far more serious consequences than the loss of a single page from a manual ledger.

Common controls used to protect accounting data:

1. Access controls (user ID and password). Every user is given a unique login, and the system restricts each user to only the parts of the data relevant to their role.
2. Authorisation limits. Transactions above a certain value require a second, more senior person's approval before being recorded, reducing the chance of an error or fraudulent entry going unnoticed.
3. Audit trail. The system automatically records who created or altered each entry, and when, so any change can be traced back to a specific user and time.
4. Regular backup. Copies of the data are taken at regular intervals and stored separately, ideally off-site, so a hardware failure, fire or virus attack does not destroy the only copy of the records.
5. Physical controls. Restricting who can physically access the server or the computers holding the accounting data, for instance by keeping the server in a locked room.
6. Anti-virus and firewall protection. Guarding the system against malicious software that could corrupt or steal data. …

A common gap is naming only password protection as the answer — examiners expect several distinct controls (technical and procedur …