System for Controlling Sales Transaction in Rainbow Illusion
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This report analyzes the system used by Rainbow Illusion for controlling their sales transactions. It identifies the strengths and problems avoided by the system, situational pressures that increase fraud, and reasons for choosing a distributed computer system.
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Running head: SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION Name of the Student: Name of the University: Author Note
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1SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION Executive Summery This report is prepared to analyse the system of Rainbow Illusion for controlling the sales transactions. The main objective of the report is to provide the information regarding the system for controlling the sales transactions of the firm to the Chief Executive Officer of the firm. This report identify the six major strength that the sales transaction controlling system of the firm have and what problems the firm is able to avoid by these strengths of controlling the sales transactions. Furthermore, report determine the two major pressure situation for the firm which may increase the fraud within the organisation. Lastly, this report provides the reason why the firms needs to choose the decentralised computer system rather than the centralized system.
2SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION Table of Contents Introduction................................................................................................................................3 Discussion..................................................................................................................................3 Strengths in Rainbow Illusion’s system.................................................................................3 Problems avoided by Rainbow Illusion’s system of controlling sales transactions...............5 Situational pressures that would increase fraud.....................................................................7 Reason for choosing distributed computer system.................................................................8 Conclusion................................................................................................................................10 References................................................................................................................................11
3SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION Introduction The report titled “System for Controlling Sales Transaction in Rainbow Illusion” is prepared to analyse the system used by the Rainbow Illusion for controlling their sale transactions. Rainbow Illusion is a retail chain firm based in the New South Wales and Victoria. The firm have 30 outlet stores in total across the city. The main business of the firm is to sale the ready to wear clothes for the young females. The report is prepared to analyse the system used by the firm to control their sales transactions. This report is prepared for the Chief Executive Officer of the Rainbow Illusion to evaluate its processes, risks and internal control for its revenue cycle. To analyse the above situation of the firm, this report try to identify the various aspects of the firm. The report mainly analyse the existing system of controlling the sale transaction to identify the strengths in Rainbow Illusion’s system for controlling sales transactions. Secondly, the report explains what problems Rainbow Illusion has avoided by incorporating such strength in the system for controlling the sales transactions. Further, the report also analyse those situations in which the frauds would increase. Lastly, this report explains why any firm should choose to install a distributed computer system rather than a centralised one by explaining the benefits of the computer system. Discussion Strengths in Rainbow Illusion’s system System for Controlling Sales Transaction is the system which is used by the firm to control and record the selling transactions of the firm. There are various methods are available for recording, reporting and controlling the selling process of the firm. As the time changes the process or the system of controlling the sales is also evolved as well as the firms also evaluate and change their system of controlling the sale transaction timely as per the
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4SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION requirement of the business. This system is specially used in such type of the business which operates in the different places with the different selling points (Mackin 2015). As the firm have various selling point in the different location hence this become difficult for the firm to report the actual selling figure of each selling point by a single person. Therefore, firm need a proper system to manage and control their sell. By analysing the given case study of the Rainbow Illusion, the following are the major six strength present in the system of controlling the sale of the firm: - Managers are salaried The first and most important as well as the major strength in the system of controlling the sale of the Rainbow Illusion is that the managers as well as the assistant managers of all the 30 stored are employed in the salary basis. Hence, all the mangers and the assistance managers of the Rainbow Illusion are getting the fixed monthly salary for their contribution towards the firm (McLaughlin and Lyon, LivingSocial Inc 2016). This is consider as the strength of the controlling the sale system of the firm because it saves the firm from the various frauds and malfunction which is will be discussed further in the report in details. Firm uses the same system for controlling sales transactions in all 30 stores The second strength inthe system of controlling the sale of the Rainbow Illusion is that the firm uses the same system for controlling the sale in all its 30 stores. This helps the firm in the various ways. For instance, this help the firm to prepare the combined report of all the 30 firm (Erenrich et al 2018). If firm follow the different system of controlling the sale then it will be next to impossible to ascertain the sale details of all the 30 stores as whole because all branch will have their own system and parameter to evaluating the sale. Cash receipts separate from accounting records
5SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION The system of controlling the sale of the Rainbow Illusion have separated the cash receipt from the accounting records of the sell. This is another strength in the system of controlling the sale of the Rainbow Illusion. This helps the firm to double check the each and every selling transaction of the firm to effectively manage and prepare their sales report. Supervision The each store of Rainbow Illusion have three mangers, one manger and two assistance manager to supervise the employees especially those employees who are related with the selling process of the firm (Price 2016). This group of mangers in each store provides the proper supervision tothe employeeshencethisisanotherstrengthin thesystemof controlling the sale of the Rainbow Illusion. The parting of cashiers and salespeople The system of controlling the sale of the Rainbow Illusion also parted away the cashier and the salespeople, not only that both also need to maintain their own and separate record of the sell. This is another strength in the system of controlling the sale of the Rainbow Illusion as this also helps the firm to cross verify the records of sell. The combined bills are one after the other ordered Lastly, the system of controlling the sale of the Rainbow Illusion combined and records the bills one after another in the prescribed manner along with the numbers. This system of recording the bill is also a strength in the system of controlling the sale of the Rainbow Illusion as this help the firm to maintain and track the occurrence of the sale. Problems avoided by Rainbow Illusion’s system of controlling sales transactions As discussed above the system of controlling the sale of the Rainbow Illusion have several strengths. This strengths of the system of controlling the sale transaction of the
6SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION Rainbow Illusion helps the firm is various manners. This helps the firm to accurately evaluate the sales of each store of all the 30 stores. This strengths of system of controlling the sale transaction of the Rainbow Illusion also help the firm to identify as well as avoid any fraud practicesperformedbytheemployeesofthefirm(AyersandOdegaard2017).The followings points discuss the major problems avoided by the above mentioned strengths of the system of controlling the sale transaction of the Rainbow Illusion: - Managers are salaried The managers being salaried avoids the issues of incorrect commission allocations and prevents inappropriate credit approvals. For example, a commission based manager may approve a customer for credit even if they are not creditworthy to obtain a sale to boost their commissions. Firm uses the same system for controlling sales transactions in all 30 stores This strength avoids the difficulty in auditing each store. For example, if each store used a different system for controlling sales transactions auditing each store would take intimate knowledge of each system. This would be time-consuming and expensive. Cash receipts separate from accounting records This strength prevents an employee from stealing a cash receipt or destroying it and changing the accounting records. For example, if the store manager had access to both the receipts and accounting records they could pocket the cash and change the records so that there was no evidence of the sale (Spicer 2019). It would then be easy to write-off the merchandise as theft by a customer. Supervision
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7SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION This strength allows for a smaller group of people to perform duties that would normally be segregated. For example, this is a small group. It would be easy for the cashier and salesperson to work together to perform a theft. However, with two different supervisors this discourages dishonesty and prevents theft from going unnoticed. The parting of cashiers and salespeople This strength of the system of controlling the sale transaction of the Rainbow Illusion avoided the problem of the fraud performed by the salespeople or by the cashiers (Wells 2017). This system of requires that the both the salespersons and cashiers need to keep their own records of sales, hence, this system reduces the chances of frauds normally performed by the sales person and cashiers. The combined bills are one after the other ordered Lastly, this strength of the system of controlling the sale transaction of the Rainbow Illusion also reduces the chances of frauds performed by the cashiers. If the firm does not implement this system in their controlling of sale transaction then cashiers can easily omit the transaction of sales and put the entire money in their pockets. Situational pressures that would increase fraud There are various situational pressures that would increase the fraud in the firms like Rainbow Illusion. The followings are the two major situational pressure for the firm which may increase fraud within the firm: - A sudden decreases in the revenue or market share A sudden decreases in the revenue or the market share of the firm results the increase in the fraud within the organisation. This kind of pressure can be experience by the firm or by the entire industry (Hess and Cottrell Jr 2016). In this situation, where the revenue
8SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION of the firm decreases hence the firm does not the sufficient fund to distribute the salaries to their employees timely. This motivates the employees of the firm to perform the fraud in the duty and try to maintain their expenses by performing theft and other illegal activities. Financial pressure resulting from the bonus plans This is another pressure which can increase the fraud in the businesses like Rainbow Illusion. Basically, the financial pressure arises from the bonus plans is depends on the short term performance of the economy of the related country or the economy of the entire world (Li et al 2017). This pressure mainly arises the frauds in the business when the bonus is the important as well as the significant component of the employee’s salary. In this situation, employer does not generate the enough profit to provide the bonus to their employees. In the other hand, the employees have the high expectation of the bonus. Hence, when employees does not received the bonus they start stealing the money from the business by performing several frauds activities to meet their predetermined needs. Reason for choosing distributed computer system The computer system of controlling the sale transactions is the system of controlling the sale of the firm by using the latest technology in the field of the computer. This is more efficient and effective system of controlling the sale transactions of the firm. In today’s developed world, most of the firm prefer this system to control their sales transactions compare to the centralized system of controlling the sale (Troncoso et al 2017). There are various benefits to use the computer system in the controlling process of the sale transactions of the firm. To understand the reason for choosing the computer system to controlling the sales transaction, firstly we need to understand the disadvantages of the centralized system of controlling the sale and then the benefits of the computer system in controlling the sales
9SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION transactions. Hence, the followings are the some major disadvantages of the centralized system of controlling the sale transactions: - The decentralized system is highly dependent on the network connectivity hence the system can fail if the nodes loses the connectivity because there is only one central node (Jannesson et al 2016). There is the lack of the graceful degradation in this system which can causes to the failure of the entire system. This system also have the less opportunity of data backup. If the system become failure than there is less chances of recovering the data. Lastly, the maintenance of the centralized system is also difficult compare to the decentralized system. As the centralized system is based on the single server hence put down the server for maintenance is very difficult. Now, the following are the some major advantages of decentralized system for the business are follows: - The system have the minimum problem in respect to the performance in the bottlenecks situation. This system has the high availability and always available for the work online. This system provides more automotive as well as control over the resources as the each server controls its own behaviour (Imrie and Bednar 2016). Hence, this system provides the better control over the resources. The above discussed advantages of the decentralised system and disadvantages of the centralised system are the main reason why the firm needs to choose the decentralised computer system rather than the centralised one.
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10SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION Conclusion Lastly, the paper conclude that the major six strengths of the system of controlling the sales transactions of Rainbow Illusion are managers are salaried, all 30 stores of the firm follow the same system, supervision, Cash receipts separate from accounting records, The parting of cashiers and salespeople and the combined bills are one after the other ordered. These strength of the firm helps the firm in avoiding the various problems. Further, the two situation pressures which increases the chances of the fraud are the sudden decrease in the profitability of the firm and the financial pressure arises due to bonus. Lastly, the various disadvantages of centralised system as well as the various advantages of the decentralized system are the main reason the firms needs to choose the decentralized computer system.
11SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION References Ayers, J.B. and Odegaard,M.A., 2017.Retailsupply chainmanagement.CRC Press. Spicer, R., 2019. Insights in Financial Fraud Research. Erenrich, D., Mukherjee, A. and Dwyer, W., Palantir Technologies Inc, 2018.Systems and methods for analyzing performance of an entity. U.S. Patent 9,996,229. Hess,M.F.andCottrellJr,J.H.,2016.Fraudriskmanagement:Asmallbusiness perspective.Business Horizons,59(1), pp.13-18. Iacob,N.M.andMoise,M.L.,2015.Centralizedvs.distributeddatabases.Case study.Academic Journal of Economic Studies,1(4), pp.119-130. Imrie, P. and Bednar, P., 2016. End user effects of centralized data control. InEmpowering Organizations(pp. 213-225). Springer, Cham. Jannesson, E., Nilsson, F. and Rapp, B., 2016.Strategy, control and competitive advantage. SPRINGER-VERLAG BERLIN AN. Li, X., Jiang, P., Chen, T., Luo, X. and Wen, Q., 2017. A survey on the security of blockchain systems.Future Generation Computer Systems. Mackin, K.J., CA Inc, 2015.Dynamic threat event management system and method. U.S. Patent 9,167,000. McLaughlin, Q. and Lyon, B.H., LivingSocial Inc, 2016.Systems and methods to implement point of sale (POS) terminals, process orders and manage order fulfillment. U.S. Patent 9,275,407.
12SYSTEM FOR CONTROLLING SALES TRANSACTION IN RAINBOW ILLUSION McLaughlin, Q. and Lyon, B.H., LivingSocial Inc, 2016.Systems and methods to implement point of sale (POS) terminals, process orders and manage order fulfillment. U.S. Patent 9,275,407. Price,R.,2016.Controllingroutinefrontlineserviceworkers:AnAustralianretail supermarket case.Work, employment and society,30(6), pp.915-931. Raval, S., 2016.Decentralized applications: harnessing Bitcoin's blockchain technology. " O'Reilly Media, Inc.". Troncoso, C., Isaakidis, M., Danezis, G. and Halpin, H., 2017. Systematizing decentralization and privacy: Lessons from 15 years of research and deployments.Proceedings on Privacy Enhancing Technologies,2017(4), pp.404-426. Wells, J.T., 2017.Corporate fraud handbook: Prevention and detection. John Wiley & Sons.