The internal auditor has just completed a review of the accounting system to determine the effectiveness of internal controls. The following four potential issues were found:

1.Bad debts have been increasing. The sales manager, who approves the credit limit for each customer, is unable to explain this increase.

2.When the computer records indicate that the stock of a product is running low, the purchasing clerk finds a supplier and sends a purchase order.

3.A small number of expensive parts have disappeared from the warehouse. Staff from the sales, finance, and engineering departments walk through the warehouse regularly but no-one has seen any suspicious activity.

4.There were many attempts to guess financial controller's system password and gain illegal access to the confidential company records.

Required:

(a)For each potential issue, suggest an underlying problem.

(b)For each underlying problem identified in Part (a) recommend and justify a control plan that will help to manage that problem.