You are an Audit Trainee at Finley Auditors. You are currently part of the audit team scheduled to audit Walmer Line Traders ("Walmer"). Walmer is a new client of Finley Auditors. Background of Walmer Walmer is a South African electric vehicle ("EV") parts manufacturer located in the Eastern Cape. The entity has a 28 February financial yearend. Walmer is in a fortunate position as the majority of raw materials required to manufacture vehicle parts, whether referring to electric or fuel vehicles, are produced (i.e., mined) locally in South Africa. The one primary component not currently produced in South Africa is the battery of the EVs. The reason for this is that Walmer's engineers are still refining the manufacturing thereof to obtain effective and consumer-safe EV batteries. In the interim, Walmer imports these batteries from an American supplier. Walmer makes use of Sales Agents to ensure the sales of EV parts are as high as possible. Each Sales Agent has a mini-computer system that is connected in real-time to the mainframe computer located in a computer room at the Head Office. Walmer Telesales During the current financial year, Walmer introduced a computerised telesales software system that was designed and implemented by a software company. Walmer also appointed two new staff members who will work in the telesales department. This was done to increase sales. Walmer appointed Mr. Ceasar as the new Telesales Manager; he will oversee the entire telesales department. Customers will now be able to phone Walmer and place telephonic orders, which will be directed to the two Telesales Operators. The two Telesales Operators will key in all the information directly into the system via their work terminals. The computer system has always been sufficient, but the company is currently considering developing their own system as a result of the rapid growth in the business. There are programmers working at the company who are competent enough to develop such a system themselves. REQUIRED: 1.1 With reference to the information under Telesales, describe the controls that should be in place of the telesales to ensure that the telephonic orders are valid, accurate, and complete. Structure your answer by using validity, accuracy, and completeness as headings. (35 marks) 1.2 Describe general controls that Walmer Line Traders should implement to prevent physical break-ins and to ensure that the mainframe computer/desktops (central server) can only be used for authorised purposes. (10 marks) 1.3 Suggest and advise how the entry of batches of delivery notes should be controlled to ensure that inputs are accurate and complete. Structure your answer by using accuracy and completeness as heading. The Telesales Operators capture data directly on the accounts master file. The accounts receivable master file contains information such as the account number, account holder's name and details, amount owed, ageing, credit limit, and terms, handed over or not to attorneys. All the customers that are account holders receive a catalogue that provides a code number, description, and price for all products that are available. When a telephonic order is received from customer's, the Telesales Operator will process the order in the system and generate an invoice. Mr. Ceasar will authorise the invoice and the instructions will be sent to the distribution and invoicing department as described below. Mr. Ceasar will review the customer's credit limit and current balance and then authorise the transaction by signing the order form. Distribution and invoicing The authorised order forms are then sent to the distribution department, where it is entered into the computer system. The computer automatically generates a pre-numbered delivery note in triplicate, and it is then handled as follows: - One copy is filed together with the order form. - Two copies accompany the delivery and are signed by the client. - One copy of the two copies referred to in the bullet point above is then retained by the client, and the other one is returned to the Accountant at the head office. Every second day all the signed and returned delivery notes are handed over to the Debtors Clerk, who then enters the last two days' delivery notes as a batch into the computer system. The computer then generates invoices from the information that was entered. Only one hard copy of the invoice is printed and then sent to the customer while an electronic copy of the invoice is kept by the Accountant. Processing of input All the orders, invoices, delivery notes, and payments are processed every third evening at 24ho0