Accounting Information System Project Report

This project report analyzes the sales process, internal control weaknesses, introduction of corporate credit cards, and provides recommendations for Bucks Phyz to enhance its operations and overcome challenges.

Accounting Information System
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Executive Summary
The project report highlight the sales process that is being followed by the management of the
Bucks Phyz and further by highlights the internal weakness and its impact on the working of the
organization. The report highlights the negative aspects associated with the current scenario. The
report points out the weakness in the internal operations of the organization and the ways or
methods in which such weakness can be overcome. The report further classifies the ways and
methods in which the risk can be spread so as to cope up with the weakness. The report further
classifies the positive and negative aspects related to the introduction of the credit cards and how
the utilization of such cards will provide the companies in implementing its policies and
guidelines in an effective manner.
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Contents
Executive Summary.........................................................................................................................2
Introduction......................................................................................................................................4
Overview of Sales process...............................................................................................................5
Internal control weaknesses in Bucks Phyz sale process.................................................................6
Review of Introduction of corporate credit cards within Bucks Phyz:............................................8
Benefits and risks.........................................................................................................................8
Internal Control Guidelines that can be implemented by Bucks Phyz to minimize the impact
and occurrence of the risks........................................................................................................10
Recommendations for credit cards............................................................................................10
Conclusion.....................................................................................................................................12
References......................................................................................................................................13
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Introduction
The entire projects related to a company which is Bucks Phyz is included in this report and they
provides the key areas of the company which is to be taken into consideration for improvement
in accounting information system of the company. The report provides many useful
recommendations and suggestions that could be adopted by the company so as to overcome its
weakness and maximize its sales revenue and thereby promoting sustainability and growth. The
recommendations are based on the review and analysis conducted for the company. The report
aims at analysing whether with the operation of the corporate credit cards, the company could be
able to achieve a favourable sales position in the market or not.
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Overview of Sales process
Bucks Phyz has 5 sales manager which works under the direct control of the head of sales who
directly reports to the finance director. Besides getting a salary, head of sales along with sales
manager are eligible to gets commission on sales. However, while calculating commission, only
the invoices against which amount have been collected are considered. Bucks Phyz has recently
introduced price calculation mechanism in which every sales manager can calculate the sale
price on which commission will be given. This new tool or structure takes into consideration all
the major influential factors affecting price determination. To enable smooth functioning, CEO is
deciding the introduction of corporate credit cards which will ensure the availability of funds all
the time. However, there are benefits as well as the risk associated with the introduction of credit
cards by the company.
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Internal control weaknesses in Bucks Phyz sale process
Internal control
weaknesses in sale
process
Impact of weakness Bucks
Phyz can face in future
Internal control to
overcome weakness
1.
Low Salary
Sales head along with all
sales managers gets a
very low salary. As
suggested by (Zhang &
Agarwal, 2015, p. 3)
repayment decision is an
important topic since it
directly impacts
consumers’ debt level
and borrowing costs. As
such, all the members of
the sale team are not
satisfied with the salary
structure. This is the
major reason for the
poor performance of
sales department or
division as the sales
personnel are not getting
good salary.
Inefficient sales personnel:
Due to poor salary structure,
sales manager along with the
sales head are not able to
perform efficiently and
effectively. This is not good
for both sales team as well as
the organization.
Revision of sales
commission policy: There
should be a proper revision
of criteria on which basis
sales commission is awarded
to the sales manager as well
as head of sales. While
considering revision, debtors
should be taken into
consideration and proper
weight should be given to
credit sales. As a result, sale
commission should be
directly linked to the total
sales.
2. Changes in sales team
Bucks Phyz is
continuously changing
its sales team as the
company is undergone
restructuring program.
Also, they are changing
the position of top-level
managers. This will
create confusion among
the sales personnel since
they don’t know to
whom to report and from
whom to take necessary
directions.
The absence of allocation of
duty: There is no segregation
of duty and distribution of
work among sales personnel
of Bucks Phyz.
Flexible contract template:
There should be flexible
sales template so that
customers can modify or
amend it according to its
own specified order or
requirement. Such flexibility
will help to boost sales. In
the words of (Leng & Zhang,
2014, p.786) people used to
focus on whether the
management has the
behaviour beyond the
control.
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3. Ignorance of debtors
while calculation the
amount of sales
commission, amount of
credit sales is ignored.
As a result, the sales
manager will always try
to increase cash sales.
However, in order to
gain a sustainable
competitive advantage,
credit sales are also
important.
Difficult to survive in the
long run: All these
drawbacks in the sales process
can seriously affect and
damage the survival and
existence of the organization
in the long run. In other
words, it will be difficult for
Bucks Phyz to compete with
organizations operating in the
business environment.
Fixed sales team: Frequent
changes in the sales team
should be avoided to the
extent possible. For this
purpose, proper training
should be provided to the
sales team. This will bring
confidence and personnel of
the sales department will
work towards maximum
efficiency.
4. Biasness of sales
manager
Concerned sales
manager can give
various promotional
offers to their own
customers. However,
these offers require
approval from either
head of sales or Finance
Director, there can be
some biasness at the cost
of Bucks Phyz.
Loss of customers: Ignorance
of credit sales can bring loss
of debtors. As a result,
customers of Bucks phyz can
switch over to other
organization from where they
can avail credit facility. Loss
of customers is a serious issue
which needs to be taken care
of.
Proper sales process: Head
of sales should develop a
formal and standardized
sales process and flowchart.
This will ensure following of
principle of direction as well
as the principle of command
as suggested by the Henry
Fayol.
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Review of Introduction of corporate credit cards within Bucks Phyz:
A corporate credit card is a card serving the distinct feature of personal and small business credit
cards. As suggested by (Segendorf & Jansson, 2012, p.3) inexpensive and easy-to-use payment
services promote trade and prosperity. The company allows the use of such card to the
employees for the business related that is expenses related to traveling. These cards are generally
issued in the name of the company. There are two types of corporate credit cards generally
issued by the company that is individual payment card and company payment card. Use of both
the credit card is required to be sanctioned by the company.
Benefits and risks
The corporate credit cards serve many benefits which help the company in smooth and easy
working like:
 Facilitate immediate and prompt payment.
 It does not require employees to utilize their personal funds.
 The company can take the report of the use of the funds at the end of the period such that they
could concentrate on other crucial issues.
 The use of such card ensures liquidity.
 Ensures safety of transactions.
However, there are some risks associated with the use of such cards which can affect the
working of an organization.
 The issue of the corporate credit card enables the employees to make certain payments on behalf
of the company which may be not required.
 At times, there is an excessive burden on the company at the end when the payment due is to be
paid.
 The employees can use these cards for their personal benefits.
 The employees may not be aware of the use and scope as such the use of such card does not
serve the working purpose of the company.
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Bucks Phyz before the introduction of the corporate credit cards is required to understand the
positive and negative implications associated with it and deeply judge on the matter related to
issue of such cards to its employees. However, the company will get several advantages by the
issue of such cards like security in its working, focus on significant area etc. This will enable the
company to carry out its operation in an efficient manner.
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Internal Control Guidelines that can be implemented by Bucks Phyz to
minimize the impact and occurrence of the risks.
Internal control policies are the policies that are adopted by the company in order to monitor and
review the activities of the company. In the words of Bubilek (2017, p. 14) internal audit is
designed to help the organization to reach its objectives. Bucks Phyz is required to take
following steps in order to maintain a good and proper control that is:
 Proper audit mechanism must be developed.
 Expenses are required to be cross check.
 Proper budget is required to be made so as to avoid the unauthorized transaction.
 Proper knowledge should be provided to the employees for the use of such cards.
 The comparison should be made between the planned and actual expenses.
The company is required to take all the measures on priority basis so as to ensure proper
working environment, this will enable the company to achieve its objectives efficiently.
Recommendations for credit cards
As per the suggestions to the Chief Executive Officer, he should take the following points into
consideration in its operation:
 The company should properly monitor the working affairs of the organization.
 Expenses towards which the corporate credit facility can be availed should be properly
determined and monitor and review from time to time.
 A fixed budget with respect the expense is required to be maintained.
 The proper report is to be maintained so as to gather valuable information.
 The concerned company should classify the expenses in which it can avail the card facility.
 Formulation of rules and regulations should be formed and properly communicate with the entire
organization.
 The concerned company is required to maintain a sound audit system.
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Conclusion
With the concepts of the above study, it can be concluded that to ensure the growth and
sustainability Bucks Phyz needs to understand all the consequences associated with the sales
process as well as the introduction of credit cards with implementation in its work process.
Before implementing any method or way in its operation or working pattern the company is
required to evaluate all the points and then select the best option so as to achieve its goals in an
organized manner and further would help to capture a big share in the market.
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References
Bubilek, O., (2017). Importance of Internal Audit and Internal Control in an organization – Case
Study. International Business.
Kamil, N.S.S.K., Musa, R., & Sahak, S.Z., (2014). Examining the Role of Financial Intelligence
Quotient (FiQ) in Explaining Credit Card Usage Behavior: A Conceptual Framework. Procedia -
Social and Behavioral Sciences.
Leng, J., & Zhang, L., (2014). Research and Discussing on Internal Control Auditing. School of
Business, Hohai University.
Segendorf, B.,& Jansson, T., (2012). Cards or cash. How should we pay? Monetary Policy
Department of the Riksbank.
Zhang, J.,& Agarwal, S (2015). A review of credit card literature: perspectives from consumers. The
National University of Singapore.
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