You have been engaged by the management of Alden, Inc. to review its internal controls over the purchase, receipt, storage, and issue of raw materials. You have prepared the following comments that describe Aldens procedures:

1.		Raw materials, which consist mainly of high-cost electronic components, are kept in a locked storeroom. Storeroom personnel include a supervisor and four clerks. All are well-trained, competent, and adequately bonded. Raw materials are removed from the storeroom only on written or oral authorization of one of the production managers.
2.		There are no perpetual inventory records; therefore, the storeroom clerks do not keep records of goods received or issued. To compensate for the lack of perpetual records, inventory is counted monthly by the storeroom clerks, who are well-supervised. Appropriate procedures are followed in making the inventory count.
3.		After the physical count, the storeroom supervisor matches quantities counted against a predetermined reorder level. If the count for a given part is below the reorder level, the supervisor enters the part number on a materials requisition list and sends this list to the accounts payable clerk. The accounts payable clerk prepares a purchase order for a predetermined reorder quantity for each part and mails the purchase order to the vendor from whom the part was last purchased.
4.		When ordered materials arrive at Alden, they are received by the storeroom clerks. The clerks count the merchandise and agree the counts to the shippers bill of lading. All vendors bills of lading are initialed, dated, and filed in the storeroom to serve as receiving reports.

Describe the deficiencies in internal control and recommend improvements in Aldens procedures for the purchase, receipt, storage, and issue of raw materials.