Question
INFO 31787 Accounting Info Systems Theory Online Final Exam Winter 20 20 Page 1 Case Analysis (24 marks) Home Renovation Warehouse In the Greater Toronto
INFO 31787 Accounting Info Systems Theory
Online
Final Exam
Winter
20
20
Page
1
Case
Analysis
(24
marks)
Home Renovation Warehouse
In the Greater Toronto Area (GTA) home renovation spending is expected to
rise due to affordability issue related to purchasing a larger home. A study by
CIBC reported in the Financial Post (http://business.financialpost.com/personal
-
finance/mortgages
-real
-estate/renovation-
spending
-expected
-to-rise
-in -2016-
as-
people
-just
-cant
-afford-
to-move) shows the following information on home
renovations in Canada:
Home Renovation Warehouse is
expanding due to the trend in
home renovation spending hoping
to capture the trend and move
their company from a privately
held company, owned by Stephan
and Sylvie Gregoire, to a larger
publically traded company. The
currently have 35 locations
spread across Canada but they
have plans to expand into the US
market as well as expand their
presence across Canada.
Home Renovation Warehouse
has issues that must be addressed
prior to expanding. The
consult
ing company they have
hired to advise them on expansion
plans requires them to have
audited financial statements. In
addition, they are using a periodic
inventory system which is a
INFO 31787 Accounting Info Systems Theory
Online
Final Exam
Winter
20
20
Page
2
barrier to optimizing their procurement activities. There are many times in which
the wrong products are ordered resulting in surpluses in inventory and stock outs
for other inventory items. This tends to frustrate the customers and the stock outs
require the company to purchase higher cost products and expediting fees. The
consultants have recommended the company implement a new computer system
that incorporates supply chain management functionality and a perpetual
inventory management system.
The Purchasing Manager, Guylaine Dumont has not taken a vacation in
several years.
She is difficult to work with and the position responsible for the
vendor bidding process has been vacant for 18 months. Three employees, hired
into this position, have quit the company and Elaine La Fontaine has not
ascertained the root cause of the iss
ue. Guylaine is opposed to changing the
inventory system as she says it is adequate for her purposes.
As the company will be competing with Home Depot and Lowes, the
consultants have recommended they implement an on-
line store where customers
order products for either delivery to their home or take advantage of in-
store
pickup. Currently their stores do not have an appropriate physical design for in-
store pickup so the current 35 stores require renovation to accommodate this new
business process. The ex
pertise to design this business process does not currently
reside within the corporation. The Sales Manager is also not in favour of
implementing new computer systems as this is not an area of expertise for him.
To support the expanding business it is re
commended for the company to
implement an ERP system however the owners are not familiar with the benefits
of an ERP nor do they have knowledge of the steps they should take to implement
as system of this nature. Sylvie Gregoire is in favour of implementi
ng new
computer systems as she views this as a necessary event to support the expansion
plans.
Their current organization chart showing key positions is displayed below:
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