ACC_week_5_fcordero - Running head CHAPTER PROBLEMS Chapter...

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Running head: CHAPTER PROBLEMS Chapter Problems Freddy Cordero Grand Canyon University
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Chapter Problems In the chapter problems reviewed there were many issues that need to be addressed. The issues addressed are from the control on cash, accounts receivable, purchasing system and accounts payable. Each situation is different and requires auditors to think and analysis the situation. The first chapter problem reviewed had 5 weaknesses, first was the fact that new customers were not being approved before the orders were shipped. Then sales prices varied from one customer to another. Returns were not being approved, and that subsidiary accounts receivables records did not match with the general ledger accounts. Finally blank checks were not stored in a secure area. To fix these issues there need to be tighter internal controls in the company. Management plays an important part in this matter. Each department manager needs to take responsibility of their department. The accounts receivable manager sign off the credit applications that are process to verify that their employee has verified, entered, called references, and performed a credit check. All this before the order is sent on credit. The manager also needs to do weekly reports to make sure all the information processed from sales conincide with the ledgers and if it does not at that time have an employee or themselves before a check to see why and correct the problem. Sales managers need to verify that pricing is consistent for the customers.
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This note was uploaded on 06/02/2010 for the course ACC 624 taught by Professor Smith during the Spring '10 term at Grand Canyon.

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ACC_week_5_fcordero - Running head CHAPTER PROBLEMS Chapter...

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