ACC539: Platinum Manufacturing Group- Internal Controls- Business Report Assignment Help

Internal Code: 1HJFJ

Business Report Assignment Help:

Task: You have been recently employed as an accountant for the Platinum Manufacturing Group (Platinum). The CEO, James, has tasked you with reviewing their expenditure process for ‘special orders’. To facilitate this, he has provided you with key information relating to Platinums special orders process (available in Interact). Using the information provided to you, prepare a business report to the CEO including the following: 1. A summarised overview of the expenditure process for special orders, focusing on the process from purchase to payments. (1 mark) [This should be no longer than one (1) paragraph and need to focus on the key relevant facts. The CEO is already aware of this information, but this overview helps bring your report together for other readers] 2. Use a system tool to develop a level 0 data flow diagram to document the current system for special orders. 3. Identification of: A. internal control weaknesses relating to Platinum’s special orders, focusing on the process from purchase to payments; B. the impact these weaknesses could have on the organisation; C. specific internal controls which could be implemented by Platinum in the coming weeks to mitigate the risks posed by the internal control weaknesses you have identified. TheCEO does not want theoretical controls suggested. They want practical controls that they can implement; and D. how the control procedures you recommended in part c. above could be modified if Platinum reengineered it expenditure cycle activities to make maximum use of current IT. For example, EDI, EFT, barcode scanning, and electronic forms in place of paper documents. (2.0 marks) [Note: all sections of part 3 (a-d) must be included as a table in your report] 2 marks will be awarded for the presentation of your report. This includes use of appropriate grammar and spelling, application of APA referencing and a report prepared in line with the presentation requirements below. Below is the information provided to you by James, the CEO of Platinum Manufacturing Group. Last year the Platinum Manufacturing Group purchased over $13 million worth of office equipment under its ‘special ordering’ system, with individual orders ranging from $3,000 to $30,000. Special orders are for low-volume items that have been included in a department manager’s budget. The budget, which limits the types and dollar amounts of office equipment a department head can requisition, is approved at the beginning of the year by the board of directors. The special ordering system functions as follows: Purchasing—A purchase requisition form is prepared by the department head and sent to the purchasing department. Upon receiving a purchase requisition, one of the five purchasing agents (buyers) verifies that the requester is indeed a department head. The buyer next selects the appropriate supplier by searching the various catalogues on file. The buyer then phones the supplier, requests a price quote, and places a verbal order. A pre-numbered purchase order is processed, with the original sent to the supplier and copies to the department head, receiving, and accounts payable. One copy is also filed in the open purchase order file. When the receiving department verbally informs the buyer that the item has been received, the purchase order is transferred from the open to the filled file. Once a month, the buyer reviews the open purchase order file to follow up on open orders. Receiving—The receiving department gets a copy of each purchase order. When equipment is received, that copy of the purchase order is stamped with the date and, if applicable, any differences between the quantity ordered and the quantity received are noted in red ink. The receiving clerk then forwards the stamped purchase order and equipment to the requisitioning department head and verbally notifies the purchasing department that the goods were received. Accounts payable—Upon receipt of a purchase order, the accounts payable clerk files it in the open purchase order file. When a vendor invoice is received, it is matched with the applicable purchase order, and a payable is created by debiting the requisitioning department’s equipment account. Unpaid invoices are filed by due date. On the due date, a cheque is prepared and forwarded to the treasurer for signature. The invoice and purchase order are then filed by purchase order number in the paid invoice file. Treasurer—Cheques received daily from the accounts payable department are sorted into two groups: those over and those under $10 000. Cheques for less than $10 000 are machine signed. The cashier maintains the cheque signature machine’s key and signature plate and monitors its use. Both the cashier and the treasurer sign all cheques over $10 000.