Inventiry Control
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- Date Submitted: 02/15/2011 08:25 PM
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Internal Control and Risk
Donica Campbell
ACC542/ Accounting Information Systems
February 1, 2011
Professor Linda Juniel
Introduction
Learning Team A has been assigned the task of evaluating the flow chart process that was assigned in week 2 of Kudler Fine Foods. This paper is to analyze the risks in the systems that Team A analyzed. Identify all risks and internal control points by incorporating the controls and risks into the flowcharts, design internal controls to mitigate risks to the systems, evaluate the application of internal controls to the systems and discuss other controls, outside the system that Kudler Fine Foods may need. The assessment will be for inventory, payroll, accounts receivable and payable.
Risk Assessment and Internal Controls
The purpose of risk assessment is to identify organizational risks, analyze their potential in terms of costs and likelihood of occurrence, and install those controls whose projected benefits outweigh their costs. (Axia College, p.243) Internal controls are the process of placing procedure and policy on order to reduce risk. In week two, Team A created flow charts for the below departments of Kudler Fine Foods. Assessment of risk and internal controls are now important to make sure the flow charts created can be properly supported. Theses are the departments below:
Inventory
Kudler’s Fine Food’s inventory process does not have a systems paper trail. Inventory receipts should be handled and verified by two people. One employee is to input the receipt into the system and another to secure the goods. The person responsible for ordering inventory should not be the same person to receive it. Inspect receipts to ensure they are accurate and not damaged. Inventory should be stored in secure areas. Access to these areas should be restricted also. Physical inventory counts should be taken periodically by someone independent of purchasing and custody using blind...
Donica Campbell
ACC542/ Accounting Information Systems
February 1, 2011
Professor Linda Juniel
Introduction
Learning Team A has been assigned the task of evaluating the flow chart process that was assigned in week 2 of Kudler Fine Foods. This paper is to analyze the risks in the systems that Team A analyzed. Identify all risks and internal control points by incorporating the controls and risks into the flowcharts, design internal controls to mitigate risks to the systems, evaluate the application of internal controls to the systems and discuss other controls, outside the system that Kudler Fine Foods may need. The assessment will be for inventory, payroll, accounts receivable and payable.
Risk Assessment and Internal Controls
The purpose of risk assessment is to identify organizational risks, analyze their potential in terms of costs and likelihood of occurrence, and install those controls whose projected benefits outweigh their costs. (Axia College, p.243) Internal controls are the process of placing procedure and policy on order to reduce risk. In week two, Team A created flow charts for the below departments of Kudler Fine Foods. Assessment of risk and internal controls are now important to make sure the flow charts created can be properly supported. Theses are the departments below:
Inventory
Kudler’s Fine Food’s inventory process does not have a systems paper trail. Inventory receipts should be handled and verified by two people. One employee is to input the receipt into the system and another to secure the goods. The person responsible for ordering inventory should not be the same person to receive it. Inspect receipts to ensure they are accurate and not damaged. Inventory should be stored in secure areas. Access to these areas should be restricted also. Physical inventory counts should be taken periodically by someone independent of purchasing and custody using blind...