Strategic Information Systems Analysis: Bell Studio Case Study

Desklib provides past papers and solved assignments. This report analyzes Bell Studio's business processes and internal controls.

Strategic Information Systems for Business and Enterprise
1

Contents
Executive summary.........................................................................................................................3
Introduction......................................................................................................................................4
Purchase system...............................................................................................................................5
Internal control weakness................................................................................................................6
Cash disbursement system...............................................................................................................8
Internal control weakness................................................................................................................9
Payroll System...............................................................................................................................10
Internal control weakness..............................................................................................................11
Conclusion.....................................................................................................................................13
References......................................................................................................................................14
2

Executive summary
The Australia country based company is a Bell Studio which has a business in Adelaide and it
has a wholesale business of supplying art things. The company has been recruiting a person
known as a business analyst who will help in understanding the big and small processor small
parts of the company. Making this report will provide the benefit of the management department
in achieving the understanding of these processes. By the understanding of these processes, it
will help the management in the process of decision making within the company. The overall
report will help the management and also provide the requirement why these systems are
necessary and the process of the company like, purchase payroll system and cash disbursement.
In this report, internal control of the system and process of the above named also be discussed
and it is underlined. It also helps in finding the way why the weakness is associated with the
internal control system and process and this will ultimately help the Bell Studio company in
order to eliminate such things.
3

Introduction
Under this report, it will provide and focus on the company overall various processes and
systems and also provide all the related details functions of the company that has been duly
performed. In the Bell Studio company, different types of processes are inherent in the company
management system and various processes are allocated into other subparts of them. For the
company, this analysis process of each system is important as it provides the reason behind the
weakness of such a process that is using by the management of the company. As the company
process and department both are interconnected and interlink to each other thus its necessary for
the company that it should be distributed the whole project between them in a proper manner in
order to make proper full efficiency along with effectiveness so that company can achieve its
objectives as per plans. Under this, a different system in the Bell Studio has been identified by
the business analyst and also fines some weak point in internal control. Analysis of them helps in
finding the area in which improvement is needed and also what and which risk are connected
with the internal control systems. It can be understood by using a flow chart and data flow chart
of various departments.
4

Purchase system
In every organisation whether it is on a large scale or small scale, the purchasing department of
the organisation is important and it plays a crucial role in providing the raw material and any
other type of material to the manufacturing or production department due to the manufacturing
department start the process of production which is sold in the market on time. Purchase
department has the responsibilities to manage all the function related to purchasing within the
organisation and help in a way to manage and procure the material as needed by the
manufacturing department of the company. From this, it has been concluded that the process of
purchasing of raw material by the purchasing department is important as it fulfills the
requirement and needs of the other department of the organisation (Buis, et. al., 2015). As a
purchase system is present in every company, the same it is also presented in Bell Studio
Company, and basically, it follows a straight forward process in their purchasing process
department. The first step and important step of the purchasing department is to check the
inventory level with the help of ledger by the purchasing person of the company. After checking
and reviewing the ledger, the next step of the concerned department is to select the appropriate
vendor from a list of all available vendor of the company. And also place an order in a digital
form so that paperless work is minimized. After that, respective purchasing person takes a print
out the copies in a hard form where the one copy of the related information is sent to the
“vendor” and other copy i.e. duplicate copy is kept with himself. After that, the goods that which
are received by the purchasing department make reconcile with the slip of [purchase order in
order to check that all goods are received or not. The company management of the concerned
department is required filing the documents along with updating the entire records and update
ledger because all the information when needed by the company is obtained through ledger
account so it is necessary to maintain and update ledger regularly. The overview of the all
process and system of the Bell studio company has been fully summarized below and the same
process has been shown by the flow chart of same:
 Overview and check inventory ledger account.
5

 Select the appropriate vendor.
 Print two copies in hard format.
 Inspect and check the received goods.
 Reconcile of received goods with the order slip.
 Prepare copy by manual manner.
 Update ledger and related accounts.
 Send invoice to vendor.
6

Internal control weakness
For achieving organizational goals and objective as per projected plans, internal control in the
entire business plays a vital role in order to achieve desired tasks. Weakness in the process of a
7

purchase system may affect the overall performance of the company and it may create new
problems in the business (Robinson, 2017). For eliminate this, it is important to evaluate the
weak area of the purchase system and improve their system by highlighting the area which
required improvement. In the Bell Studio company, the weakness is identified and risks
associated with them are also evaluated as below.
 The company selects the vendor from its existing file that was already maintained by the
company and it does not give preference to the new vendor who able to provide the best quality
with minimum price. So this opportunity may miss the Bell Studio company and maybe pay a
high price to the existing company who already in their database. So that is risk associated as the
company pay the high price which can be easily purchased from other vendor and also provide
the facility of fast service of delivering the goods. Appropriate
 The company can take the advantages of the internal control system of purchase only in case if
the Bell Studio company is having a business of trading like purchasing and selling the same
product as they received. In other words, sell the goods without changing the nature of the
products. It has been analyzed that if the company is engaged in processing further activities of
the goods then it not good for the company lead as that orders of the customers are not fulfilled
on time.
8

9
Checking Inventory
Ledger account
Select appropriate
vendor
Print two Hard
Copies Inspecti of goods
reconciled order via
digital form with
items receiving
Prepare of copies in
hard form manually
Updated Inventory
ledger account
sending of invoice for
payment purpose

Cash disbursement system
It is the process of making payment to the employee and another person by the Bell Studio. It
helps in the company in order for the effective and efficient management of cash payments
including cash account, accounts payable and another account of the company. The process of
making payment is duly managed by the concerned department of the organization with the help
of the above system i.e. cash disbursement system (Herrera-Cáceres, and Ibeas, 2016). This
system is operated in the business activities of the Bell studio in below manner:
 Documentation receipts received sent by the department.
 Fill all the information related as per requirement.
 Cheque (invoice) prepared.
 Duly signed the cheque and sent to the vendor.
 Update all the related accounts.
Cash disbursement flow-chart
10

11

Internal control weakness
In the company, there is some weak point in the cash disbursement system which affects the
company cash management. It is the duty of the concerned department that this weakness
regarding the cash should be sorted out quickly; if it is not done on time then the company will
suffer in future as they reduce their capability of managing cash in the business. Following are
some weakness in the cash disbursement system:
 In Bell studio, the process of the cash disbursement system is rigid in same or identical types of
process related to the same transactions. In this, it also a weak point that this system does not
change even when the overall transactions of the company change. This will lead the company to
introduce any new technology and also affect the company in terms of those transactions which
are not necessary for the company in future time (Sullivan, 2019).
 It may create a situation of fraud ness as there is not sub-process of this system to take high
author for the specified transactions of the Bell studio company.
12
1Document
receipt sent by
the department
2Fill all the
information as
per required
3prepared
cheque
prepared
4Duly signed
cheque
5Duly Signed
cheque send to
vendor
6Updated all
related
accounts