Case Study: Revenue and Receipts

Furry Friends is a pet shop group with retail outlets across the country. With the advent of Covid$-19$ the group decided to launch an on$-$line sales app with the option to either collect the goods instore or home delivery within $24$ hours. Customers must create an account before being able to buy on$-$line. Information required to create an account is the customer$$s first name, last name, email address and a password. Once the account is created, the customer must supply a street address where the goods must be delivered if the home delivery option is selected. A customer number is created automatically for all customers who create an account.

Furry Friends recently introduced a credit facility for customers who order on$-$line and have spent more than R $3500$ with the store in the last $18$ months. A credit limit of R$2000$ is granted to all successful applicants.

The request for credit is done on$-$line by completing the credit application form and attaching the following certified documents:

$$ Copy of ID

$$ Proof of address

$$ Three month$$s payslips

$$ Certified copy of most recent account statement for examples a mobile phone account statement.

The application rejects any applications for which mandatory fields are not completed and the required documents are not attached.

The application is reviewed by the debtor$$s clerk and the credit history verified if the documentation meets specified criteria. The documentation is submitted to the credit manager who reviews the information and either approves or rejects the application. The decision is noted on the application form which is then signed and dated.

If the application is approved, the credit limit is captured on the debtor master file by the credit controller. An audit trail is generated of all master file changes. Master file changes are reviewed and approved electronically weekly by the credit manager. An email is sent to customer confirming that their application was successful.

When the customer places an order, the product details and prices are retrieved from the price master file. Once the order is finalised, customers who have an approved credit limit receives an option to use their credit facility if the amount of the order is less than the credit available. The customer must indicate if the option is selected or not. If not selected, the amount must be paid by credit card, eft or paypall. Customers who do not have a credit limit must pay by credit card, eft or paypall.

Required

a$.$ Identify risks associated with the process.

b$.$ Identify $4$ controls. Your controls must include manual and automated controls.

c$.$ What weaknesses exist in the process.

d$.$ Identify $3$ trend analysis that the internal team can use to assist with planning.

e$.$ Identify $5$ data analytics queries that the internal team can run using CAATS.

f$.$ Recommend one process that the client can improve $($make more efficient$).$

g$.$ Identify possible fraud risks that Fuzzy Friend$$s management must be aware of$?$