Parisian Imports buys furniture and dcor items from France and sells them to retailers. Erin Moreland is

Parisian Imports buys furniture and décor items from France and sells them to retailers. Erin Moreland is the general manager of the company. Moreland employs two other people in the business. Nadine Mast serves as the buyer for the company. Mast travels throughout France to find interesting new products. When Mast finds a new product, she arranges for Parisian Imports to purchase and pay for the item. She helps the artisans prepare their invoices and then faxes the invoices to Moreland in the company office.

Moreland operates out of an office in Brooklyn, New York. The office is managed by Sandy Richter, who handles the mail, keeps the accounting records, makes bank deposits, and prepares the monthly bank reconciliation. Virtually all of the company’s cash receipts arrive by mail—from sales made to Target, Crate and Barrel, and Williams-Sonoma.

Richter also prepares checks for payment based on invoices that come in from the suppliers that have been contacted by Mast. To maintain control over cash payments, Moreland examines the paperwork and signs all checks.

Requirement

Identify all the major internal control weaknesses in Parisian Imports’ system and explain how they could hurt the company. Also state how to correct each weakness.