Revenue System Weaknesses at Townsend Flooring Ltd
What are the weaknesses in the revenue system of Townsend Flooring Ltd?
Identify and explain FIVE weaknesses in the revenue system of Townsend Flooring Ltd and suggest improvements to overcome these weaknesses.
Weaknesses in Townsend Flooring Ltd's Revenue System
The revenue system of Townsend Flooring Ltd has five weaknesses in the areas of price alteration permissions, telephone orders security, inventory management, cash handling, and online sales system.
Permissions for price changes: One weakness is that any sales assistant can access and change pricing in the master file. Implement strict policies for authorized managers to make changes.
Security of telephone orders: Details of telephone orders recorded in notebooks can lead to data manipulation. Upgrade to real-time data entry.
Inventory Management: Goods unavailable in inventory delay orders. Improve inventory management for stock prediction.
Cash Handling: Cash payments for the floor fitting service could result in loss. Incorporate a mobile payment system.
Online Sales: Complaints about incorrect products due to inadequate controls. Enhance online systems with appropriate technology.
General and application controls are necessary to support the IT function and specific applications. General controls include password policies and disaster recovery plans, while application controls ensure data integrity and correctness, such as input validation and transaction authentication.