PART B: CHIPPS INVENTORY PURCHASING AND MANAGEMENT INFORMATION FROM THE CEO: MRS SOPHIA MARTIN Chipps is a medium size, privately owned, Australian enterprise. They manufacture computer parts including microchips, motherboards and graphics cards and are a key supplier to computer manufacturers and repairers across Australia. Chipps is 12 years old and uses an integrated ERP system. The administrative offices are in a central city building with the production, shipping, and receiving departments located on the outskirts of town, just 10 minutes away. Below is detail regarding the inventory purchasing and management processes at Chipps. PURCHASING A purchase requisition form is prepared by the department head and sent to the purchasing department. Upon receiving a purchase requisition, one of the five purchasing clerks (PC) verifies that the requester is indeed a department head. The PC selects the appropriate supplier by reviewing prior orders placed for the same or similar items. The PC then phones the supplier and requests a price quote. Once the quote is agreed, a pre-numbered purchase order (PO) is processed by the PC, with the original sent to the supplier and copies to the department head, receiving department and accounts payable. One copy is also filed in the open purchase order file. When the receiving department verbally informs the PC that the goods have been received, the purchase order is transferred from the open to the filled PO file. Once a month, the PC reviews the open purchase order file to follow up on any open orders. RECEIVING DEPARTMENT The receiving department gets a copy of each purchase order. When equipment is received, that copy of the purchase order is stamped with the date and, if applicable, any differences between the quantity ordered and the quantity received are noted in red ink. The receiving clerk then forwards the stamped purchase order and equipment to the requisitioning department head and verbally notifies the purchasing department that the goods were received. ACCOUNTS PAYABLE Upon receipt of a PO, the accounts payable clerk files it in the open purchase order file on their desk. When a vendor invoice is received, it is matched with the applicable purchase order, and a payable is created by debiting the requisitioning departments equipment account. Unpaid invoices are filed by due date. On the due date, a cheque is prepared and forwarded to the treasurer for signature. The invoice and purchase order are then filed by purchase order number in the paid invoice file. CASHIER / TREASURER Cheques received daily from the accounts payable department are sorted into two groups: those over and those under $5,000. Cheques for less than $5,000 are machine signed. The cashier maintains the cheque signature machines key and signature plate and monitors its use. Both the cashier and the treasurer sign all cheques over $5,000. What are the internal control weakness, Impact of the weakness and control mitigate the weakness from above case study ?