The following is a list of 12 control plans from this chapter or from Chapters 8 and 9.
Control Plans
A. Enter customer order close to where customer order is prepared
B. Turnaround document
C. Independent shipping authorization
D. Populate input screens with master data
E. One-for-one checking of the goods, picking ticket, and sales order
F. Preformatted screens
G. Confirm input acceptance
H. Reasonableness check
I. Backup procedures (for data)
J. Program change controls
K. Digital signature
L. Personnel termination controls
The following are 10 system failures that have control implications.
System Failures
1. Weathersby Corp. has recently received customer complaints that the goods they receive frequently are not accurate. Sometimes they receive the wrong goods and sometimes the wrong quantity.
2. Baldwin Company receives Internet orders from established customers. Recently the company received a number of orders from individuals impersonating legitimate customers.
3. A recent audit of the order- entry process at Lymer, Ltd. determined that the clerks were making many errors while entering data such as the customer’s name and address from the customer order documents.
4. A former employee of True Corp, gained access to the order entry department after hours and logged on to the system using her old user ID. She entered an order for a legitimate customer but instructed the system to ship the goods to her home address.
5. Medcam Inc.’ s field salespeople record customer orders on prenumbered order forms and then forward the forms to central headquarters for processing. Zrinka Bow, one of the company’s top salespeople, mailed 40 customer orders to headquarters on one Fri-day afternoon. Unfortunately, they were misplaced in the mail and did not reach headquarters until two weeks later.
6. Fairmont Inc.’s clerks key order data into the order entry system at one of several PCs. During the first week of using this system, every sales order produced by the computer was missing the data for the “ship-to” address.
7. At Nashville, Inc., the finished goods warehouse delivers goods to the shipping department, accompanied by the picking ticket. Then the shipping department prepares a packing slip. A recent audit discovered that a dishonest warehouse employee had been forging picking ticket documents, allowing him to have goods shipped to an accomplice.
8. The job of Jerry, a programmer at Tolland, Inc., included doing maintenance programming for the order entry application. Gladys altered the programs so that the credit- checking routine was bypassed for one of the customers, a company owned by her uncle.
9. After receiving goods from the warehouse, with attached picking ticket, shipping clerks at Bostian Company key in the sales order number, item numbers, and quantities. The computer then records the picking ticket data and prints a packing slip. Customers have been complaining that the packing slip is not accurate as to items and quantities.
10. Clerks in the shipping department at Waynick, Inc. scan picking tickets to retrieve the appropriate open sales order and then scan another bar code on the picking ticket to trigger the recording of the shipment. Then a packing slip is prepared, attached to the box, and the box is placed on the conveyer to the loading dock. They have discovered that some shipments are not being recorded by the system.
Match the 10 system failures with a control plan that would best prevent the system failure from occurring. Write one or two sentences explaining each answer. Because there are 12 control plans, you should have two letters left over.