Report on Internal Control - Bucks Phyz
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Added on 2020-06-03
Report on Internal Control - Bucks Phyz
Added on 2020-06-03
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INTERNAL CONTROL1| P a g e
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................11. Summarized overview of the sales process for Bucks Phyz........................................................12........................................................................................................................................................12.(a) Identification of internal control weaknesses in Bucks Phyz sales process...................12.(b). Impact of weaknesses on the business..........................................................................22.(c). Specific internal control................................................................................................23........................................................................................................................................................33.(a). Detailed review of the benefits and potential risks associated with corporate credit cardintroduction.............................................................................................................................33.(b). Specific internal controls to minimize the risks involved.............................................33.(c). Recommendations to the CEO regarding who should be issued with a card with reasons................................................................................................................................................4CONCLUSION................................................................................................................................4REFERENCES................................................................................................................................52| P a g e
INTRODUCTIONInternal control can be defined as a procedure to make sure that all the operations arecarried out complying with the legislations, policies and regulations as well. It safeguardbusiness itself against any fraudulent activities, theft, embezzlement and any manipulation in thefinancial reporting. Bucks Phyz is a medium sized organization getting a turnover of AUD 2.5billion every year. The aim of the assignment is to critically investigate and evaluate its currentsales process to identify weaknesses and suggest specific control measures. Besides this, asbusiness is looking for introducing corporate credit cards to purchase smaller items. Therefore, itwill examine the relevant benefits and risk with necessary measures to eliminate it. 1. Summarized overview of the sales process for Bucks Phyz In organization systematic sales process is followed and under this if any entity intends toenter in to contract with company then in that case negotiation round are commenced. Duringnegotiation round entire details related to company is collected from the market and relatedwebsite in respect to credit rating (Van de Poel. and Vanstraelen, 2011). By doing so it isidentified whether front party is in good position and whether it will be right to do deal withthem. If all things are perfect the quotation are given to front party and contract is inked withthem.22.(a) Identification of internal control weaknesses in Bucks Phyz sales process There are lots of internal control weakness in the company sales process. In respect toeach transaction entry is done in the system. In single day large number of entries are done in theaccounting system. Due to this reason there are chances that wrong entry may be done in booksof accounts and computer systems. Hence, wrong results can be obtained from analysis of dataand firm can make wrong decisions. Thus, there is not control system that can ensure that allaccounting or transaction related facts are entered accurately in systems. This is one of majorweakness in the control system of the company. Apart from this, there are some other weaknessin the internal control system. Other major weakness in internal control system is that data onceenter in to system it’s double checking is not done (Mikalsen, Jones. and Roskilly, 2010). Hence,if one enter wrong data then that will be considered as final one and wrong decisions will betaken on basis of it. Apart from this, if individual that is doing entry of data if manipulate facts1| P a g e
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