C. Internal Control Procedures in Conversion Cycle (10 points)

You are part of a consulting team that has been asked to review the design of the conversion cycle at Northern Tractor, a manufacturer of commercial and consumer garden tractors. You are the person on the team with the most knowledge of the risks and internal controls associated with the systems that comprise the conversion cycle; and you understand the importance of ensuring that the data and information processed and reported by these systems are free of material error and that the likelihood for fraud to occur is minimized. As you prepare to review these two systems, identify five (5) specific internal control procedures that you are going to look for in the design of the production planning and control and the cost accounting systems.

(Note: be specific in your responses so as to demonstrate an understanding of the internal control procedures that you are looking to be in place. For example, if you were asked to identify specific internal control procedures for the sales processing system, one of the procedures that you may identify is that a credit function separate from the sales function reviews the potential customers credit, and if appropriate, authorizes the sale.)