Clearcut (Pty) Ltd Weaknesses

Flashcards on weaknesses in the system.

Re-order levels and quantities

Guidelines only; placing an order on theoretical balance without checking may result in overstocking or shortages.

Printout (requisition) importance

It's the initiating document for the audit trail; without a copy, Gilbert Simoni can't respond to queries or defend against problems.

Confirming supplier details

Despite approved suppliers, confirm availability and delivery dates to avoid production delays and lost sales.

Access to local area network

Inadequate; general password weakens control over application access, increasing unauthorized access risk.

Application-level access

Inadequate due to a general password known to many, allowing access to any module and increasing risk of invalid transactions.

Minimum entry application control

Bob Marli keys in extensive information already on the system, which weakens efficiency and increases possibility of errors.

POs vs. Printout requisition

No supervisory check of POs against printout means errors and unauthorized purchases can occur.

Family members' duties

Family members performing two important functions in the same cycle weakens division of duties, increasing collusion risk.

Throwing away the printout (requisition)

Destroys the audit trail, making it impossible to follow up on purchase authority or resolve requisition queries.

Pieter Tosh's Authority

Too much authority vested in Pieter Tosh in approving suppliers, adding them to the supplier master file and adding part details to the inventory master file, creating potential conflicts of interest and insufficient documentation

Lack of Supervisory and Managerial Functions

No checks are carried out on the functions as Pieter Tosh initiates and executes the decision to add a supplier, and the part details; Pieter Tosh retains/controls the evidence (logs) thereof; and there is no master file amendment form documenting the amendment, no independent review or authorisation takes place