Sales Order Processing Procedures and Processes Your group, after receiving a report prepared by a consultant hired by the company, compiles the following information:
For some of the orders from individuals, Tasteless accepts credit card payments that are processed by the sales representatives when an order is taken, credit information is included on the sales order ticket. Supermarket, restaurant, and certain individual customer sales are handled as an open account after the credit department reviews the customer’s credit in the case of a new customer and past payment history in the case of existing customers placing new orders. Each customer is assigned a credit limit that is followed strictly when a new order is processed. A sales invoice is included with each shipment, specifying payment terms of net 30 days on open account shipments and invoices. For open account purchases, the invoice instructs customers to make payments payable to Tasteless Tea Company and to mail them to corporate headquarters. Three mailroom clerks open the daily mail in the company’s mailroom, which is monitored by closed-circuit television. Each clerk manually and individually prepares a list of the customer checks received in the daily mail, by clerk, that day. The original copy of this list is sent to the corporate treasurer; one photocopy clerk. In terms of processing, the accounts receivable department records the checks received daily in the cash receipts journal and posts individual collection amounts to the accounts receivable subsidiary ledger, both of which are automated. The mailroom clerks stamp the back of each check “For Deposit only to the account of Tasteless Tea Company” and prepare the daily deposit slip. The checks and deposit slip are given to the cashier, who deposits the checks each day at the local bank and gives the deposit receipt to the corporate treasurer. In terms of reporting lines, the mailroom clerks report to the cashier who reports to the corporate treasurer. At the retail stores, customers pay for their products at the checkout, using bank debit cards, credit cards, or cash. The store cashier, under the supervision of the store manager, prepares a daily cash report that reconciles the amount of money in the cash drawer from the store opening to the store closing. A standard amount of small bills and coins is maintained in the cash drawer on a daily basis, with the remaining cash sent by overnight express courier to Tasteless’ headquarters where the cashier counts and eventually deposits the money in the bank. Bank debit card and credit card receipts also are sent to headquarters for processing. The cashier has a staff of three clerks to process the large number of bank debit cards and credit card slips and to ensure Tasteless receives credit for these funds from the corresponding banks and credit card companies. Each of the retail stores manually prepares a sales slip indicating the product code, description, and quantity for each customer sale transacted in the store. These sales slips are mailed to headquarters on a daily basis. Using the information contained in the sales slips, a clerk in the controller’s department records all of the retail store sales activity in the sales journal and inventory control records. For each retail store, the corporate controller reconciles the daily sales activity to the daily cash report described in the previous paragraph and sends a copy to the corporate treasurer.

Information Systems and Accounting Information Systems: Background
Tasteless is considering implementing new information systems solutions, initially addressing those functions related to the revenue transaction cycle. The company would like a system including both hardware- and software-related solutionsthat expedites order processing by the sales representatives and at the retail stores. Management also would like to make better use of information systems to support sales and marketing activities and to take advantage of leading-edge information technology. As you can see, the acquisition of the 300 retail stores has placed further strain on the already overburdened accounting information system, especially since management recently installed a budgeting program throughout the company. Management is interested in incorporating the 300 retail stores into the planned accounting information system. Management also recognizes the need to modernize the accounting system and incorporate basic and vital accounting activities to efficiently manage current operations as well as the retail stores recently acquired. The accounting system must be able to support each store’s operations as well as the existing direct sales operation, and be able to generate the results for each store as well as for each geographic region and each product line.

Sales and Marketing Information Systems: Background
Sales and marketing are vital to the operation of any business. Orders must be processed and interface both with manufacturing production planning and inventory levels. Sales of products in existing markets must be monitored and new products must be developed for new markets. The company must be able to respond rapidly to changing market and customer demands, the proliferation of new products from competing companies, shortened product life spans, changing consumer tastes, and new government regulations.
Companies need sales and marketing information for product planning, pricing decisions, advertising and other promotional campaigns, forecasting market potential for new and existing products, and determining the most efficient channels of distribution. They also must monitor the efficiency and effectiveness of their distribution system. The regional sales managers and the store managers constantly complain about the lack of timely information, especially sales information, which is necessary for them to effectively manage the areas under their responsibility.
Sales managers need sales-related information to plan and monitor the performance of the sales force. Management also needs information on the performance of specific products, product
lines, or brands. For example, price, revenue, cost, and sales/volume growth information can be used for pricing decisions, for evaluating the performance of current products, and for predicting the performance of future products. From basic sales and invoice data, a company can produce a variety of valuable information reports to guide sales and marketing. For example, for weekly, monthly, or annual time periods, information can be generated on which retail outlets order the most, the average order amount, the speed at which products move, which salespersonssells the most, which geographic area purchases the most volume of a given product, and how current sales of each product compare to its last year’s sales volume.

Case Requirements
You have been asked to help solve Tasteless’ information technology and accounting information system problems and design a new system for the revenue transaction cycle. It is important
to establish the scope of the new system you will be designing. It should be limited to traditional activities i.e., order processing, credit approval, shipping, invoicing, and cash collectionincluded in the revenue transaction cycle as well as sales, marketing, and accounting activities. For this assignment, you do not have to redesign Tasteless’ production cycle manufacturing, distribution, or inventory control systemsnor the expenditure cycle. In your report, you should consider and briefly comment on how the implementation of suggested hardware and software requirements may impact the production or expenditure cycles. One of the options you should explore in your proposal is the need for a new, in-house information system IS. Issues to consider are whether to include a new multi-tier IS with an application server, a database server, or a web server, or a combination of all three; what type of software application architecture for example, an ERP solution, an Enterprise Application Suite architecture, or a service-oriented architecture; and what type of development options e.g., in-house only, third party only, or third party assisted the company should consider for the new IS, as well as the pros and cons of whatever development optionsyou propose.

System Design Report Specifications and Topics
Prepare a systems analysis and design report for the revenue transaction cycle, which you will present to the Board of Directors. At a minimum, you should consider the following topics in the
order indicated below in your report:

1. Prepare a brief written summary of the project, including overall goals and objectives of the proposed information system, the estimated implementation timetable, and the overall benefits of implementing your proposed system. Why should the Board consider implementing your proposed system design?

2. Provide a brief description of the existing problems and its relationships to the existing information system.