Aat Project Based on the Internal Control of Cookridge

1. Terms of Reference 1. 1. The tec make investigation on the authority of the inwrought Controls and ex intentionation constitution of Cookridge Carpets Comp both(prenominal). It withal has few(prenominal) additional contents much(prenominal) as recommendations that patrons the conjunction to correct its strengths and weaknesses to entertain the political go badys re rangeation. 1. 2. The detective excessively investigated on the s peeholders of the Cookridge Carpets political party, both(prenominal) inhering and external. The stakeholders mon account a very important design in divine serviceing the every last(predicate)iances growth. 1. 3.The discipline overly investigates that the equals and benefits to Cookridge Carpets and utter that cheat is a major brat of the confederation. It is in both case been recommended by the police detective the basis in which this hazards should be avoided. 1. 4. Lastly the police detective a homogeneous(p) i nvestigated that the requirements of the indispensable Controls and Accounting trunks piece is part of the AAT Level 4 diploma in Accounting. 2. Executive Summary 2. 1. This theme investigates the effectiveness of the internal construes of the account statement bodys of Cookridge Carpets corporation.The recommendations atomic number 18 overly m fruit drink to show ship elicital in which the Cookridge Carpets high society confirm improve its arrangement and execution of instrument. It is investigated that Cookridge Carpets party social occasions the centralised account governance. That is, its write up system clay trunk is d star in oneness base. As findings of the function of alter accounting body were do, it is recommended that the accounts lag of Cookridge Carpets should be dexterous and be qualified in order to be Competent on their turn tail on. Thus improve the action of the troupe. 2. 2. The researcher recommends that the Cookridge Carpets political party should aximize its auspices brass to tame the ventures of machination at bottom the participation. As comfortably as BACS manufacturements agreement should be employ so that employees and suppliers be paid come to the foreright into their let accounts. This get out minimize the commit of verifications and funds as the way of dedicatement hence improving the beau mondes recompense control dodge. 2. 3. If thither is maximum credentials inwardly the Cookridge Carpets smart dictated, this result promote the module members esprit de corps and improve the opinion control, payments to suppliers and lastly abridge the risk of sendup deep down the c completelyer-up. 3. Methodology 3. 1.The researcher utilization the internet to research the selective information on how companies b overlook market or perform their its avocation. 3. 2. The researcher economic consumption books as a consultation as an addition to find prohibited the information to assistant with the report. 3. 3. The researcher similarly interviewed Managers from different companies on how they run their telephone circuit and what is expected in order to run a thriving crinkle. 3. 4. A questionnaire was in any case produced by the researcher and sent to both Internal and external stakeholders to find out their different st stationgies Of running a prospering furrow concern. 4. Introduction to the Organisation . 1. Cookridge Carpets ships party is a declamatory carpetings, meek furnishings and bed enfranchisement in Southampton. It is a main head t distributivelyer for email protected fizz Beds and mattresses in the argona and having been accomplished in 2007, it has been trading for the past iii years. It is a private limited high society set by two br approximately early(a)s, asshole and john Cookridge. 4. 2. The two br others purchased a large p dance band of land on which they substantial An air craft hangar coat building to function as the carpet and bed showroom. They started out selling carpets and consequently expanded into beds and softFurnishings. In February 2010 Cookridge Carpets conjunction was asked by Memo Beds to become the main enfranchisement for Southampton as the existing Local f entirely out was retiring. The two Brothers squander been very successful in direct gross gross revenue and mother recently started selling carpets and beds over the internet. This get ahead sufferms to have increased task concern. John is marry to Paula, who acted as companionship secretary for the archetypal two years of the beau mondes existence. 4. 3. The Cookridge Carpets community has a relatively straight structure ( rede extension1). This is a benefit to the come with be guinea pig the structure as few take aims of attention, has extensive span of control, it is decentralized, this means that the communication amidst the superiors and subordinates is quick and in a ddition has high freedom of responsibilities of employees. 4. 4. The Cookridge Carpets caller-outs accounting segment constitution is Decentralized arranging. This means the accounting systems atomic number 18 through in conglomerate places. This is an advantage to the caller-out beca enforce the purposes within the beau monde atomic number 18 faster compargond to centralized system, the hap viement has much cartridge holder to do other things that be part of the ending devising, and also the system is dynamic, this is it is adapted to change.Leadership soulfulnessal manner of the fraternity is normally laissez faire beca mapping controls within the company is deprivationing e. g. employees character accounts subdivision reckoners for their self-interest. watchfulness is also sorry, employees do wee in their own preferred time. 4. 5. External regulations change the geological formation 4. 5. 1. The Data Protection spell 1998- This regulation states how Cookridge Carpets company should yieldle or make the clandestine development or data roughly the note. Cookridge Carpets has to pass water certain(a) that it follows the recreate to avoid penalties if the data is let on without any egal agreement or action. 4. 5. 2. novel payment law- This Act states that Cookridge Carpets company essential(prenominal) distribute payments fairly among employees and essential non delay any payments for that matter. Failure to do so the company might see very disturbing penalties such as fines etc. 4. 5. 3. Health and safety legislation- Cookridge Carpets essential company must(prenominal) Comply with the Act by making veritable its customers or employees argon having a nice safely running(a) environment free from flagellums or hazards that may affect their health. 4. 5. 4. The companys Act 2006- This Act regulates that Cookridge Carpets ust machinate fiscal statements and finalize them so that they argon urinate to be an alyzed. Fraud Act 2006- at a set out place pasquinade act 2006 a person may face penalties if they breach one of the separates 2 (fraud by false representation), fragment 3 (fraud by dis snuging to fall upon reading) and section 4 (fraud by call out of localise). Cookridge carpets especially the accounts subdivision should make sure it abides by the Act to avoid penalties unwavering(a) imprisonment or even countless fines. 4. 6. Cookridge Carpets Internal Stakeholders 4. 6. 1. Owners- Peter and John Cookridge argon the owners of the Cookridge Carpets company.As the owners of the company, their responsibilities atomic number 18 to make sure that the company pays revenue enhancement according to the principle. They also expression at the financial statements of the disdain to see if the business is making a realise or loss. They also look at the cost of the the business as sound as turnovers and also make budgets of the their own business. 4. 6. 2. Management- The senior accounts shop assistant is liable for the perplexity of the business. He is responsible for managing the accounting rung and making recommendations reports establish on the weaknesses of the accounts system to improve them.Also to centralise on the paysheet part department system to make sure that it complies with the paysheet department Act required. 4. 6. 3. Employees- The business employed 20 members of faculty nine Direct gross sales provide, three internet sales mental faculty, two cleaners, two car delivery drivers, one inletory salesperson and lastly three part time rung in the humbled accounts departments. 4. 7. Cookridge Carpets External Stakeholders 4. 7. 1. Customers- Cookridge Carpets customers ar owners of small business shops or stores who buy their legals from Cookridge Carpets and sells to other customers from their own shops. This is an advantage to both arties be defecate the capital flow is world generated. 4. 7. 2. providers- The su pplies of Cookridge Carpets atomic number 18 manufactures of Goods including foam beds, mattresses and carpets. Suppliers leave alone be focvictimization on the payments for sounds be supplied. The financial statements go out erect info to decide whether to provide assurance to Cookridge Carpets company. 4. 7. 3. Bank- This is the main stakeholder of Cookridge Carpets beca affair it deals with the financial accounts of the company as the company is facing some overdraft challenges. If the overdrafts demand to be repaid this might affect the companys budgets and hard currency flow gum olibanum isturbing the companys accomplishment. 4. 7. 4. Westbridge Finance- Cookridge Carpets company offers monthly Payment damage to all customers at 6months interest free credit. Once this issue expires there is an annual interest rate of 28. 4%. the company finance this by dint of Westbridge, which charges an annual rate of 8. 7% to the company. 4. 7. 5. The debt ingathering agency- This agency charges ? 80 per case to Cookridge Carpets company plus 30% of any monies collected. 5. The Accounts segment 5. 1. Cookridge Carpets has accounts department lieu which is located on the first floor of the showroom.Access to the authorization is by a set of stairs at the rear of the building. Toilet facilities for supply and customers ar also on the first floor, so the stairs are utilize by the members. The accounts stave are responsible for preparing sales invoices and to manage credit accounts. at that place is a waiting room for customer service. The accounts department practise the code in the organization. 5. 2. The accounts department is mainly utilise to order and recognise all sorts of activities on increaseion of the accounts involving sales and purchase ledger and payroll. 5. 3. The accounts department internal stakeholders 5. 3. . Peter and John Cookridge- These are the owners of the Cookridge Carpets Company, as the owners of the company, their re sponsibilities is to make sure that the company pays tax according to the principle. They also look at the financial statement of the business to see whether the business is making a avail or loss. They also look at costs of the business as substantially as turnovers. 5. 3. 2. Wages Clerk- This field is responsible for the preparation of the weekly and monthly payroll training. To consummately calculate all monies over cod engage and commission. To make up pay packets for the weekly paid rung nd do BACS returns for monthly paid stave. To prepare all associated returns and documentation and willing to start out un quested hours as requestiness. 5. 3. 3. Accounts Clerk 1- The accounts shop assistant is responsible for preparing sales Invoices (sales ledger) in the accounts receivables. liable to manage credit accounts. To ensure that all payments are make with 90 mean solar days. To prepare monthly management information and must be willing to undertake extra hours as motivatinged. Also responsible for security of information and security of hard currency. 5. 3. 4. Accounts Clerk 2- The accounts clerk is responsible to check GRNAnd purchase invoices in the accounts payables (purchase ledger). Responsible for liaise with carpets, beds and soft furnishings suppliers. To manage accounts payable accounts. To ensure that all payments are made accurately and on time. To prepare monthly management information and must be responsible for security of information and security of payments. 5. 3. 5. Senior Accounts Clerk- Responsible for managing the accounting provide and making recommendations reports based on the weaknesses of the accounts system to improve them. Also to focus on the payroll system to make sure that it complies with the payroll Act. . 3. 6. Stores Staff- These are the companys additional faculty that helps with customers. They scarper mainly in stores and require cope supervision and accurate help from the accounts members. 6. po lish of the Accounting System 6. 1. The researcher investigates the accounting system of Cookridge Carpets and also makes recommendations to improve the system. 6. 2. This section also investigates the financial reports the accounts system should hand to their stakeholders and to see if it is acceptable to agree or to meet the companys ask and the stakeholders regards. The trengths and weaknesses are aided in the jam epitome (see appendix 2). 6. 3. Working methods and practices 6. 3. 1. Strengths in the on the job(p) methods and practices within the systems of Cookridge Carpets are verbalize in the SWOT psychoanalysis in appendix 2 as follows * The Cookridge Carpets companys accounting system and memorial system operates its payroll system apply Sage payroll department to calculate the employees weekly recompense and salaries. It uses Microsoft Excel and the invoices are made using Word document. The computers fucking also price of admission internet which is cooperati ve to the employees to search and get information they need quickly. The company also has an alerting within the premise which is utilize to minify the risks of larceny within the company. * in that respect is also the use of bracingss on computers to protect confidential information from be disclosed or stolen. 6. 3. 2. Weaknesses in the running(a) methods and practices within the systems of Cookridge Carpets are state in the SWOT analysis in appendix 2 as follows * thither is escape of back-up of important information of the company and this put the company at risk of losing this important information. * Most of the employees are non familiar with using the legitimate systems deal Microsoft Excel and Sage payroll system.This is non skillful for Cookridge Carpets company because this might lead to errors in important data or documents of the company. * there is wishing of discipline within the company. For archetype, some employees may just use the Accounts depar tment computers for their self- interest same(p) shop on line. This is non good for the company because the computers are reserved to keep confidential information and should non be utilize by wildcat provide members. * there is neglect of communication in the company which may lead to shortsighted termination making and action plans. * on that point is poor security within the company. For example, there was a ase when John gear up the door of accounts department unlocked. * thither is lack fostering for each of the roles within the organization. * thither is lack of preparedness within the company. This is non good the company because this will make some errors in the business and the company would non be able to meet its goals or fail to meet its goals. * Most Cookridge Carpets staff is part time workers. This is a disadvantage because there are non available in the office at all times to monitor the companys proceeding or taking part in some tasks needed for t he performance of the company. 6. 4. disk Keeping System 6. 4. 1.Weaknesses in the remember keeping system are express as part of the SWOT analysis in appendix 2 as follows * The Cookridge Carpets company payroll is done manual of armsly, this is not good for the company because errors may easily result or occur. * Most staff is not comfortable or super trained effectively on the use of Microsoft Excel system and the Sage payroll system. If they relate using these systems, errors on documents such as spreadsheet may build up and cause the company to produce faulty financial reports of the business. * in that location is no work being done for other members of staff when they are slay at work.Important or urgent work is there for done manually for them. This is not good the company because errors may result in the work being done. * The staff take coin in directly from the till and the subaltern exchange is not properly preserve. * Wages are done manually and in advance, and then are not accurate. * The staff hours are recorded manually and the pay are cypher manually by the fundamental hours made by the staff leading(p) to inexact payment. * there is lack of security within the record keeping department. This is not good for the company because confidential information may be stolen to be employ once morest the company. . 5. Training of staff 6. 5. 1. The weaknesses in the pedagogy of staff of Cookridge Carpets company are stated in the SWOT analysis in appendix 2 as follows * Cookridge Carpets employees lack training in their accounting field. This is not good for the company because it leads to lack of knowledge and understanding about general controls and the company procedures. Errors may also occur out-of-pocket to lack of train, this might affect the performance of the business. * Cookridge Carpets staff is also lacking training on the use of the current systems.For example they are unable to used the stick tables in the surmoun t spreadsheets and the as headspring as the Sage payroll system. This is also good for the company because it usher out cause for still errors to the business. 7. Internal controls and analysis of fraud 7. 1. Internal System of Control 7. 1. 1. Cookridge Carpets companys controlling system is not that productive, in other vocalises is in starchy. The companys control system is based firmly on trust. This is not good at all for the Company because fraud can be easily arises. courtly internal controls system is good for Cookridge Carpets because say-so risks of fraud may be cut back. . 1. 2. The internal control system weaknesses are determine in the SWOT analysis in appendix 2 as follows * Passwords unmatchable unexampleds is being used to access the accounts department systems. all(prenominal) employees can be able to use the password in accounts office, this is not good for the business because the computer stores confidential information which is not allowed for the m embers of staff to see or disclose without any legal permission. * Wages- Wages are calculate and recorded manually within the business. This is not good for the business because inaccurate results or documents about wage are being produced.There is also no control in place for who collect staff wages and wages are not write for in the business. * Petty notes- There is no short currency control system within Cookridge Carpets at all. The measure used from the petty hard cash is not recorded, which is also not good for the company because it influences the risks of thieving within the business. * Cheques- The control system of the business involving cheques within the company is very poor. It is poor in the sense that blank cheques are gestural and left(a) with staff. The system is also poor because the office where the cheque books are kept can be left unlocked. hard currency- The controls in regard to the use of cash is very poor within the business. Cash produced is nor mally used to pay wages of the staff and also calculated manually. Tills are also not counted for the amount interpreted is also recorded manually. * Counter Signatures- Cookridge Carpets companys controlling system on wages is not effective. Wages are not cross checked to preclude some errors that may easily be produced. * Credit Control- The companys control in the credit control system is not that adequate. The company use or seek help from the credit citation agency when they grant credit to customers. tonic supplier and customers- Cookridge Carpets company has poor controls in regard to new customers and suppliers of the company. This is bad for the business because confusions between old and new customers and suppliers can be created and cause serious problems to the business. * Authorisation- Cookridge Carpets lack effective authorization control. Wages are not authentic in a formal manner because they are calculated and recorded manually. This is not good because errors can easily occur. Cheques are also needed to be write by the owners. 7. 2. synopsis of fraud 7. 2. 1. There are contingent frauds that could take place within theCookridge Carpets companys control system. There are no evidence were the searcher found cases of fraud within the company. The effective controls should be produced that prevents such cases. 7. 2. 2. The SWOT analysis in appendix 2 shows the weaknesses within the system as follows * Cheque books are not safely stored in a prepare place. This is not good for the company because the cheque books might get misplaced or they can be stolen. * The company use cash to pay wages which is not good for business because cash can easily get stolen by the employees without anyone noticing. The risk of fraud can easily take place in cases were cheques are signed and left blank for staff to use when the owners are not at work. * There are ways in which the staff can just take money directly from the tills instead of using the petty cash system. This is not good for the business because the staff can take the business money for their self- interest and dont return it back or pay for it. * Cash is used to pay the members of staff and the payment is calculated and recorded manually. This is not good because errors may occur and this could make the staff to be paid more or less than the correct amount they should earn. . Recommendations to improve Cookridge Carpets Accounting System 8. 1. The following are recommendations that can be made to improve the weaknesses found by the researcher. 8. 1. 1. The password used to access the system must be changed to Avoid the risks of disclosing confidential information and to reduce the risk of fraud. The staff of Cookridge Carpets must be informed of the need to have the effective controls to work expeditiously. 8. 1. 2. Cookridge Carpets company staff must be given formal accounting training to improve on their weaknesses in order to reduce or eliminate possible errors.Th is could also help them to have much understanding of the grandness and the need for controls within the company. 8. 1. 3. Cookridge Carpets should introduce controls that deals with new suppliers and customers to the accounts system. The owners should be in full involved to reduce the risks of fraud within the business. 8. 1. 4. The company should also introduce the effective petty cash control system within the organization. This will benefit the company because the petty cash would be recorded appropriately and this would reduce the risks of fraud as the cash taken from the till would be recorded. 8. 1. 5.Cookridge Carpets company should back up its system. This will benefit the company because the important information would not be lost in the event of a system failure or if incidents like fire outbreak occur. 8. 1. 6. The Senior restrainer should be fully responsible for the management and operation of the new system introduced within the Cookridge Carpets company to avoid p oor performance of the company and maintain capability and effectiveness. 8. 1. 7. The company must make payments to employees and suppliers by BACS. The payment should be made directly into strand accounts to reduce the use of cash and cheques for payments.This will benefit the company a handle because the risks of fraud and theft would be controlled as soundly as errors made during Calculations as the company make calculations manually. 8. 1. 8. Cookridge Carpets company should discipline that it keeps cheque books in a locked and take prisoner place like a safe. The system of signing blank cheques should also be stopped. The Senior Accounts clerk should be put in control of signing cheques when the owners are upset. This would reduce the chances of fraud within the business. 8. 1. 9. There should also maintain a fully up to date register of working taff hours to ensure that staff are at work at required times. Cookridge Carpets company staff must always be informed to cover for each others absence to keep the working put across. This will be a good advantage to the company because the performance will improve. 8. 1. 10. Staff should also be trained on the operation of the new systems like the use of Microsoft Excel spreadsheet and the Sage payroll software product. This would benefit the company because the staff would be having operational skills hence improve performance and efficiency of the company. 9. Cost benefit analysis 9. 1. The following is a completed cost benefit analysis of the ecommendations to introduce a centralized accounting system within Cookridge Carpets company 9. 2. COSTS 9. 2. 1. Cookridge Carpets company would need to purchase effective equipment for the meshing of computers. The organization would rather buy cables or use a wireless network. The costs of all this is approximately ranging between ? 600-? 1,600. Wireless network would be faster than cabling but the society could be lost on some occasions. Cabling on the othe r hand would be more reliable because it is less high-priced compared to wireless network. 9. 2. 2. The staff can stop using the current manual system f the organization face some disturbance or disruptions to the new system. As the workload will be a lot, additional staff will be needed to enter data about particular documents of the organization so that the system would be fully operational. This would require costs of approximately ? 3000. 9. 2. 3. The organization would also need to look at costs of introducing procedure manuals to ensure staff can use the system and a rota to cover some elements when some staff are not available at work. The senior accounts clerk will need to monitor this progress and would take approximately 30hours of their time f the workload is too much. 9. 2. 4. Cookridge Carpets company would also need to purchase centralized accounts computer software such as Accounts Professional which has been intentional for both small and big companies. There are different types of encases of this kind and the company will have to choose which package is best suitable and needed by the company. This package would cost approximately ? 3,500 depending on the quality and size of it. The package should be simple(a) to operate and should come with instructions on how it is used. 9. 2. 5. If the staff finds it more complex to use or operate the package urchased, the company would have to provide training for staff. Courses for staff would cost approximately ? 500-? 700 depending on the level of training. 9. 2. 6. As part of training on the operational of the new accounts package purchased, these would be an luck cost of the staff not be available at work. 9. 3. BENEFITS 9. 3. 1. Cookridge Carpets would need to complete the centralized system reports including the financial system of the business. This could be monitored by both the owners of the business or the senior accounts clerk to ensure that the business is running ccording to plan and t he cash is being generated and managed effectively. This reports affect would take on * Payroll Reports * Income Statements * Aged debt analysis * Supplier payments reports * Statement of financial position * Cash flow statement * Costs by cost centre/code * digest of petty cash expenditure 9. 3. 2. Cookridge Carpets would need thee cash flow statement to help the owners John and Peter to study the cash flow of the organization. It could also help them to manage the cash more effectively and efficiently to minimize the overdraft and other fees within the business.It could also help them with planning and budgeting other cash expenditures of the business. 9. 3. 3. The organization would need the age debt report to improve the system on making debts and to make sure that the customers who do not pay the business on time are closely monitored in order to minimize the issue. This could also make it demanding for the customers to misuse the current controls thereof many another(pre nominal) bad debts would be closely prevented. 9. 3. 4. Payroll reports of Cookridge Carpets company would be more accurate and up to date on rules and regulations set by the business. This would minimize confusions and defective payments ade doing calculation thus improving the staffs performance and efficiency in work. 9. 3. 5. Cookridge Carpets company would benefit a lot on using a centralized system because it will be used as a back up just in case the system being used breakdown. Cookridge staff would expect with their tasks if one of the computers fail to function or breaks down. There will be reduced risks of losing important data because if the main system fails to work, it would be operational once again and this time would be fast in performance. 9. 3. 6. Another benefit to Cookridge Carpets would be the formal training of staff.This would be helpful to the business because it will increase and improve efficiency and effectiveness of staff on their work. Their morale wo uld also be improved thus scram commitment to the organization with lower staff turnovers. The morale of the non- accounting staff would also be improved due to the accurate and complete wages. 9. 3. 7. Cookridge Carpets would benefit by having an improved cash flow system because the supplier reports on payments are implemented and suppliers are paid on time. this could further more benefit the credit terms and conditions that suppliers grant Cookridge Carpets company. 9. 3. 8.Another benefit of the company would be the lower risks of fraud prevented by the avail of the controls within the system as well as improved control cost. Reports on costs would help the owners of the business with the payments and wages and states where some costs are higher(prenominal) or lower than expected by the business when they are finally analyzed. 9. 3. 9. The business would use the statement of financial position to show the assets and liabilities of the company. It would also show dilate of th e receivables (debtors) and payables (creditors) and allow the owners to have a regular and more accurate picture of these. This ould help the company to highlight any issues with the size of payables and receivables. 9. 3. 10. The business would also benefit by using the income statement to show the owners of the company the income or revenue legitimate received and the costs of the business. This could show profitability by month or by product depending on the details required. This would help the owners with decision making and analyzing the business and would highlight key costs such as cuss interest. appendage 1- Organization chart Appendix 2- SWOT analysis STRENGTHS WEAKNESSES * There is an alarm code they set every day evening when they lock up. * Access to the accounts office on the first floor is voiced because the keypad lock is never used. * All computers are skew-whiff with licensed software owned by the company * The password used on all of the computers is the sa me and never been changed. * No member of staff is allowed to load any software onto the computers without ulterior permission from the manager. * The check book is not kept in a utterly safe area. * No unauthorized devices are to be used for saving, uploading or downloading work other than those purchased and approved by the company. * There is lack of control as all staff can get access to the accounts office with the common password. * No unauthorized discs, memory sticks, external hard drives or other devices are to be used within the accounting system. * Cash being generated is used to pay wages this is not good for the company because it increases the risks of theft. * Only authorized members of staff are to use computers. * There are high risks of errors within the business as some staff is not qualified in accounting. * The inventory information of beds, carpets and soft furnishings are kept on Microsoft pass spreadsheet. * The inventory information of beds, carpe ts and soft furnishings are kept on Microsoft excel spreadsheet. * Two new computers were purchased by Cookridge Carpets Company and are both running the Windows expectation operating system. They are also loaded with Microsoft Office 2007 ( with a three drug user license) . * There is lack of control concerning the petty cash system some staff can just take the money from tills without recording the amount being taken. * There are also two new computers purchased and loaded with Sage Payroll software. * or so staff has lack of knowledge on using the new systems like Microsoft word excel. This is not good because it might cause plenty of errors within the business. * When the computer system was set up, a password was installed to protect the information stored on it. * Invoices are processed manually this is not good for the business because errors can easily be made during processing. * The cash taken from tills is not recorded this is not good for the business because r isks of fraud and theft may easily occur. * There is inaccurate staff pay due to lack of controls on staff hours and manual calculations of wages. * Payments to suppliers are made without informing other staff members. This is not good because it may lead to high chances of fraud. * There is lack of authority blank cheques are signed to cover absence. * There is inaccurate staff pay due to lack of controls on staff hours and manual calculations of wages. OPPORTUNITIES THREATS * There is an hazard to introduce some back up staff to cover for those who are absent so that work can track being done without any delay. * If staffs who lack knowledge and experience continue using the spreadsheet and some other software, it will bring threats to the business. Errors will be made during the working progress therefore the results of the data being produced would be incorrect and inaccurate. * There is an hazard to introduce formal training to staff that lack knowledge and experien ce in accounting and also the new system they use like the use of Microsoft excel spreadsheet and new software introduced by the business. * If the company does not back up its current systems, there will be a threat of losing some important data of the business when the system in use breakdown. * There is an fortune to introduce close supervise and control of the payroll system and internal audit to the companys accounting system. * It appears that one password is used to access the accounting department system. This is a threat to the business because the computers are believably storing confidential information which is not divinatory to be seen by the staff without any authority or permission. * There is an opportunity of using new systems such as the Microsoft excel spreadsheet to record and calculate data. This is good for the company because recording data manually will be replaced. * Using cash to pay wages of the employees is a threat to a business because fraud and theft can easily take place within the business. The wages may on the other hand be incorrect due to the manual calculations. * There is an opportunity to introduce some back up staff to cover for those who are absent so that work can continue being done without any delay. * It appears that office staffs are paid by cheques. This is a threat to the company because the frequent use of cheques can lead to risks of cheques being stolen or fraudulently used. * There is an opportunity to introduce formal training to staff who lack knowledge and experience in accounting and also the new system they use like the use of Microsoft excel spreadsheet and new software introduced by the business. * There is a threat of making incorrect and inaccurate invoices due to manual completion of invoices. * There is an opportunity to introduce close monitoring and control of the payroll system and internal audit to the companys accounting system. * If staffs who lack knowledge and experience continue using the spreadsheet and some other software, it will bring threats to the business. Errors will be made during the working progress therefore the results of the data being produced would be incorrect and inaccurate. Appendix 3-Fraud Matrix Potential Fraud flowing Control Risk To The Organization Recommendations