A Back Door Way to Changing Supplier Addresses in Oracle E-Business Suite - ERP Risk Advisors
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A Back Door Way to Changing Supplier Addresses in Oracle E-Business Suite

A Back Door Way to Changing Supplier Addresses in Oracle E-Business Suite

A Back Door Way to Changing Supplier Addresses in Oracle E-Business Suite


Background:

Most organizations have a control defined over the entry of and changes to Supplier Master data including the Supplier’s address.  Allowing a user as part of the payment process to change the address for a check would essentially allow them to circumvent the expected controls that normally happen through the supplier master maintenance process.

Risk Presented and Analysis:

The Allow Address Change option in the Payables Options form enable a user to make a change to the Supplier’s address to re-direct where a check it sent.  This would allow a fraudster to make a change and give them physical possession of a check that is not meant for them.  There are various ways that fraudster could get that check cashed.

Therefore, this option should never be allowed to be set for any Operating Unit.  All changes to a Supplier’s mailing address should follow your organization’s normal change process rather than allowing a clerk to make this one-off adjustment when entering a check.

If this is currently allowed, it needs to be disabled (unchecked).  The process should be to require an additional address be set up or a change to the default address through the Supplier Master process. 

Following is a screen shot of the Payables Options configuration form:



Note that this configuration is org (OU / org_id) specific.  If you have more than one Operating Unit, this configuration will need to be evaluated / changed for each Operating Unit independently.

Following is a description of this process from the Oracle Payables Users Guide:

Recording a manual payment

1. In the Payments window select the Manual Type.

2. Enter a Trading Partner. The Supplier Number is automatically displayed. If there are multiple Supplier Sites, select the appropriate site from the list.

3. Enter the Payment document Date. The date must be in an open period. If the Allow Pre-Date Payables option is enabled, then you can only predate a computer-generated payment.

4. Enter the Bank Account from which you want to make the payment.

5. Select a Payment Method.

6. Select the type of Payment Document if Printed is selected as the Payment Process Profile.

7. Select a Payment Process Profile.

8. If you have enabled the Allow Remit-to Account Override Payables option, then you can select a different, active Remit-to account. The list of values includes bank accounts assigned to the supplier that have the same payment currency.

Important: The system ensures that Quick payments cannot be created for payment to inactive bank accounts.

9. Enter a Maturity Date if the Bills Payable payment method is selected.

10. Select a Rate Type.

11. If necessary, enter or adjust other information:

If you created the payment for an address different from the supplier site and your Allow Address Change Payables Option page, Payments tab is enabled, adjust the address. For example, you may need to send an expense check to a

consultant working at a site away from home.

Following is an excerpt from the process related to recording a manual payment (which is often used to generate a ‘one off’ check.


Recommendations:

Following are our recommendations related to this risk and configuration:

1.       “Allow Address Change” should NOT be checked (enabled) for any Operating Unit

2.       Any changes to Payables Options configurations should be approved by someone responsible for fraud prevention.  In other words, the Payables Process Owner should NOT be able to approve a change to this configuration.

3.       If you have a tool to monitor access control risks, you should have rules as follows:

a.       Single function rule related to Payables Options – verify that the only users with access to this function are those that can make changes in Prod once approved as part of your organization’s change management process – typically this means IT users / business analysts. 

b.       SoD rules – Enter AP Payments vs Payables Options – no one user should have access to the ability to generate AP Payments (particularly the function that allows single payments to be created) as well as the ability to maintain Payables Options.  The SoD rule would be “Enter AP Payments vs Payables Options” – our rule ID PP048.

Note: For recommendation 3 above, we offer a service to evaluate access control risks that includes Segregation of Duties conflicts, single function risks (Restricted Access), and access to sensitive data. Our rule set is the most comprehensive in the industry.  Find out more about our rule set at: erpra.net/Content.html.  Our content includes Rule ID PP109 as a single function rule to identify who has access to maintain Payables Options.  Our content also includes Rule ID PP048 “Enter AP Payments vs Payables Options” since no one user should have access to the ability to generate AP Payments (particularly the function that allows single payments to be created) as well as the ability to maintain Payables Options. 

Contact us at erpra.net/contactus.html  for more information about CaoSys GRC solutions if you are interested in learning more.  We offer our Role / Responsibility analysis solutions as a service (CS*Proviso) or via installed software (CS*Proviso).  See more about CaoSys GRC solutions at caosys.com.

Download a pdf of this article here.

Recommended Services from ERP Risk Advisors

We offer an evaluation of Application Controls design effectiveness along with an analysis of the configurations.  This service can be performed typically in one to three weeks.

Since some of these risks need to be evaluated by reviewing access controls, a SaaS service to review role design may also be appropriate.  We perform that service through our partner, CaoSys.

Contact us at erpra.net/contactus.html  for more information about these services or CaoSys GRC solutions if you are interested in learning more.  We offer our Role / Responsibility analysis consutling as a service (CS*Proviso) or via installed software (CS*Comply).  See more about CaoSys GRC solutions at caosys.com.

 


Appendix A- Definition of Payables Options:

This query below can be run to identify how this configuration is set:

Select *

From AP_SYSTEM_PARAMETERS_ALL

The column related to the “Allow Address Change” configuration is UPDATE_PAY_SITE_FLAG.  A value of ‘Y’ means the capabilities are allowed – i.e. they CAN change the Supplier Address when a manual payment is processed, effectively bypassing any controls over the Supplier master.


About ERP Risk Advisors

ERP Risk Advisors is a leading provider of Risk Advisory services for organizations using Oracle Applications.  We provide consulting and training services related to compliance, security, risk management, and controls.  We also assist organizations in implementing GRC-related software from industry-leading companies such as Oracle, CaoSys, Smart ERP Solutions, and MentiSoftware.

About Jeffrey T. Hare, CPA CISA CIA

Jeffrey Hare, CPA CIA CISA is the founder and CEO of ERP Risk Advisors.  His extensive background includes public accounting (including Big 4 experience), industry, and Oracle Applications consulting experience.    Jeffrey has been working in the Oracle Applications space since 1998 with implementation, upgrade, and support experience.  Jeffrey is a Certified Public Accountant (CPA), a Certified Information Systems Auditor (CISA), and a Certified Internal Auditor (CIA).   Jeffrey has worked in various countries including Austria, Australia, Brazil, Canada, Germany, Ireland, Mexico, Panama, Saudi Arabia, United Arab Emirates, and United Kingdom.  Jeffrey is a graduate of Arizona State University and lives in northern Colorado with his wife and three daughters.  You can reach him at jhare@erpra.net or (970) 324-1450.

Jeffrey’s first solo book project “Oracle E-Business Suite Controls: Application Security Best Practices” was released in 2009.  His second book project “Auditing Oracle E-Business Suite: Common Issues” was released in 2015.  Jeffrey has written various white papers and other articles, some of which have been published by organizations such as ISACA, the ACFE, and the OAUG.  Request these white papers here.  Jeffrey is a contributing author for the book “Best Practices in Financial Risk Management” published in 2009.

LinkedIn: linkedin.com/in/jeffreythare

Twitter: twitter.com/jeffreythare

Blog: jeffreythare.blogspot.com

Jeffrey T. Hare
jhare@erpra.net

Jeffrey Hare, CPA CIA CISA is the founder and CEO of ERP Risk Advisors. His extensive background includes public accounting (including Big 4 experience), industry, and Oracle Applications consulting experience. Jeffrey has been working in the Oracle Applications space since 1998 with implementation, upgrade, and support experience. Jeffrey is a Certified Public Accountant (CPA), a Certified Information Systems Auditor (CISA), and a Certified Internal Auditor (CIA).

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