Question
Kelinchi Trading is a pet shop that sells various brands of pet products, including pet food, toys, vitamins, and shampoos. Customers can make purchases at
Kelinchi Trading is a pet shop that sells various brands of pet products, including pet food, toys, vitamins, and shampoos. Customers can make purchases at the physical shop or via an online e-commerce portal. The following events have caused losses to the business. Examine each situation and propose ONE (1) control procedure that would prevent the situation.
(i) Inventory shortage is a common issue in the business. The shortage is usually observed during the stock count activity conducted every six months. Currently, one security guard watches the storeroom during nighttime. During the day, no guard was on duty, on the basis that Maleek, the store manager, is usually in the storeroom during office hours.
(ii) Maleek also observed that during the stock-count activity, his team always has to count inventories twice, because there are always errors in counting every item in the storeroom. This means stock-count activity usually takes longer than expected, causing some disruptions to the business operations.
(iii) Mariya is the officer in charge of the Shipping Department, which deals mainly with online purchases. Most of the time, shipments reached the customers successfully. However, sometimes errors happen during the shipment - either wrong brand or wrong quantity sent to the customers. This became a concern because Mariya will have to deal with complaints from the customers.
(iv) Jason handles the Accounts Payable function in the company. He is responsible to approve all payments to the suppliers. Recently, there have been a few incidents where double payments were made to the same supplier
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