📖 What is Separation of Duties (SoD)?
Separation of Duties (SoD) is a fundamental internal control that ensures no single individual has total control over all phases of a critical transaction or process. This prevents fraud and errors by requiring collaboration between different roles.
"Look for the word 'collusion' in the answer choices. SoD is designed to prevent a single person from committing fraud, but it can be bypassed if two or more people collude."
📚 Certification: Certified Information Systems Auditor (CISA)
🔑 What are the Key Concepts of Separation of Duties (SoD)?
- ▸ Separation of Authorization and Execution: Ensures the individual approving a transaction is not the same person processing it to prevent unauthorized actions.
- ▸ Custody and Recording Split: Prevents fraud by ensuring the person handling physical assets does not have access to the accounting records for those assets.
- ▸ Environment Segregation: Prevents developers from having write access to production environments, ensuring code is reviewed and deployed by a separate entity.
- ▸ Mitigating Compensating Controls: In small organizations where SoD is impractical, auditors look for increased management oversight and detailed audit logs to mitigate risk.
- ▸ Collusion Vulnerability: Recognizes that while SoD prevents individual fraud, it cannot stop two or more people from conspiring to bypass the controls.
🎯 How does Separation of Duties (SoD) appear on the CISA Exam?
You may be asked to identify a control weakness in a scenario where a system administrator has the authority to both create new user accounts and approve their access levels.
A scenario might describe a small IT team unable to implement full SoD due to staffing constraints; expect to choose 'compensating controls' or 'increased management monitoring' as the best alternative.
Expect questions asking for the most effective method to prevent a single employee from initiating and completing a fraudulent financial transaction within an ERP system by splitting the process.
❓ Frequently Asked Questions
What is the difference between Separation of Duties and Dual Control?
SoD divides a process into separate tasks performed by different people. Dual Control requires two people to act simultaneously to complete one task, such as two employees providing keys to open a secure vault.
How should an auditor address SoD conflicts in a small organization?
When staff shortages make SoD impossible, auditors look for compensating controls. This typically includes more frequent management reviews of logs and independent audits of critical transactions to detect anomalies.