Question

An IT risk of Cash Disbursement Process is Data security and confidentiality. In what ways can this risk effect your finacial statements?

Answer 1

In case any payment related data is lost or compromised , it can lead to

- payments intended for a thrid party going to another

- wrong amounts being disbursed

- unauthorised persons getting access to your data or your customer's data

- reputational damage to your concern

All this can directly or indirectly impact financial statements e.g.

- Cash losses in case higher amounts are paid , your expenses will be booked higher

- in case a third party sues you because of compromise of data or wrong payment , it may lead to contingent liabilities on account of any claims which may be required to be settled as per court direction.