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60. Internal controls and risk BSR Inc. is the corporate office of a chain of coffee shops around the United States. Dudley Baker is considering
60. Internal controls and risk BSR Inc. is the corporate office of a chain of coffee shops around the United States. Dudley Baker is considering opening a franchised location with BSRs support, and has asked BSR management about potential risks and ways to address them. Several risks associated with the franchise operation are listed below on the left; potential controls are listed on the right. Match each risk with the control that will address it most effectively. 1. Customers leave without paying their bill. 2. Damage from natural disasters, such as fire or earthquake. 3. Food quality variances due to inconsistent preparation. 4. Gratuities (tips) going to the wrong server. 5. Lack of customers due to poor geographic location. 6. Raw material spoilage. 7. Robbery. 8. Running out of popular menu items. 9. Table servers giving away food. 10. Unusually high employee turnover Computerized records of cash receipts. a. Market research before opening the restaurant. b. Matching customer orders with food prepared. c. Monitoring order trends & purchasing raw materials based on them. d. Monthly staff meetings. e. Placing cash register near the door. f. Standard recipes & adequate training. g. Thorough emergency procedures, like an evacuation plan. h. Video surveillance system near the entrance. i. None of the above
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