Question

A sales system for a small retail store is described in the following paragraph. Once you have read the paragraph, identify any risks within the system, the potential consequences of these risks, and controls that could be implemented to combat these risks.
The sales system
As a sale occurs, customer details including customer number and address, as well as the items purchased, are written on a blank invoice form. Item descriptions, quantity sold and unit price are also filled in, with the sales staff having some discretion in setting the unit price for situations such as bulk purchases or repeat customers. These invoice forms are collected at the end of the day and keyed in to the computer, with an invoice number assigned to invoices as they are keyed in. This number is recorded on the store copy of the invoice. Any new customers are added to the customer master list as their sales are entered and any details not gathered on the invoice are left blank. Data are stored on a central server and this server is backed up monthly. The system is also connected up to the organisation's suppliers and used to order goods

Answer 1

Risk: Risk of error in keying in data from the hard copy to the computer.There is no check if any error occur. There may be eoor in customer details , unit price, quantity etc.

Consequence: Due to error in data, ordering of goods are affected, Goods required may not be ordered or goods not required may be ordered

Controls: The entry to computer should be done at the point of sales and a printout may be taken for audit trail.

Physical inventory of items (a few items daily)should be taken based on records to ensure that data is entered properly at the point of sales.