3.2 Control Matrix Explanation

The control plans are:

1. The first control plan is the search the order of the customers. The order of the customer need to be searched first so that the items of the order can be known. The customer first places the order and then it is searched by the sales department to see the order that is placed by the customers
2. The next control plan is the preformatted screens. It means that the orders will be once again checked to see that nothing is wrong with the order that is placed by the customers,
3. The next control plan is the online prompting. The online prompting is done by the sales department to see the credit of the customers. If they have any credits of the company then they have to pay the credits then the items will be shipped to the customers
4. The next control plan is the interactive feedback from the credit department and they will enquire and see that there is any credit of the customers. They provide the feedback to the sales department of the company
5. The next is the sales department will check the credit of the customers and ensure that the customer has no credit or they will pay using the credit cards and the credit card have enough balance for the items ordered. In this the credit department will information the sales department about the deposition of the credit required for the items ordered by the customers
6. The next control plan is the popular input with the master data. In this the sales order department will acknowledge the order to the customers and it will be ensured that the items will shipped to the customers within the provided time.
7. The next control is the programmed checks of edit and it will include the checking of the master data to see if any editing is required so that they can notify the shipping department about the orders of the customers.
8. The next control is the checking of tickets with the goods. The shipping department will take the ticket of the order from the sales department and will send it to the catering office so that they can check the ticket with the items that is placed by the customer
9. The next control is receive and input turnaround document. In this control plan, the shipping department will receive the good from the catering office and they will have to input the order number and the items in the document so that it can be tallied further in the process.
10. The next control plan is the independent authorization of shipping. In this plan the shipping need to be authorized to a particular delivery person so that the goods can be delivered to the customers within time.
11. The next control plan is the compare the input with the master data. The shipping person will need to compare the data with the master data. The master data includes the name of the details of the customers and the goods of the customers. After checking the data, the shipping person will validate that the order is ready for shipping and the catering office will provide the goods to the shipping person so that it can be shipped in appropriate time
12. The next is the checking of goods. The shipping person check the goods before delivery and he need to pick the ticket and provide it to the sales department after the order has been picked up from the warehouse of the company. It is very important to check the order before delivery so that wrong items are not shipped to the customers.

3.3  Control Analysis

The overall adequacy of sales subsystem controls will be fair to say that these parents’ controls are not enough if the management of catering want to maximize the profit (PI, Christensen & Hansen). Business around the world are becoming global and they are taking advantages of the technology, whereas the controls of sub system department then this department is very behind in using advanced technologies and also sales department roles are not properly designed. Even though business is making profit but still lacks the potential to grow in future.

Business sales department has the control over what to buy on what price and goes through logical process with the help of inventory management department but lacks the budget information like how much budget is set by the management in a particular period for the purchase of inventory. Also, the lack of advanced technology such as latest accounting software’s is increasing the manual work which may result in human error.

Quality of Controls

There are several controls in the purchasing department, some of them are mentioned in the matrix, if we consider the efficiency of these controls then all of the present controls such as checking the orders of customers, checking the credits of the customers and many more are working in very efficient way but still the problem comes in regarding the out to date technology they are using, if the technology used is much more advanced then these control will be much effective and efficient.

  An expensive control can support a single goal for example if we consider the above matrix then Controls 1 and controls 3 can be the good examples of such cases. Sometimes some controls are very important for a subsystem that if they support single goal and are expensive than any how management has to bear it, Control 1 is the initial stage of purchase and it only has a single goal but purchasing department cannot perform their role if they exclude this control on the basis of supporting single goal. Same goes for Controls 3 as the comparison of vendor to get best price and quality will lead the business to achieving its goals

Preventive control refers to the control which works in order to reduce the errors from occurring. In sales department all those controls who work in order to reduce such things will be called as preventive controls. In given control matrix our Preventive controls can be Controls 7, 8 and 9.

3.4  Managerial Recommendations for each sub system under review

The following controls would be recommendations:

1. Accurate demand forecasting is an important control plan (Hasni et al, 2019). This control can be applied by analysing the market trend and it also come with experience. Just checking the physical inventory and accounting software is not enough to order the inventory, the owner should identify the real demand of the customers which may change with the circumstances. This control plan is missing in catering and following control goal can be achieved by applying this control plan.

This control fulfils the effectiveness goal as If there is check of accurate demand forecasting it will bring operational efficiency, because the order will be made with the knowledge of exact demand in the market. Therefore, there will be less chance of excessive stock or stock outs.

• There are three methods of inventory management, which are FIFO, LIFO and Average weighted method (Adistyra, Triayudi & Esthi, 2020). These three methods are being used by almost all big organisations. None of the method is being used in sub system of catering. For catering the suggested method is FIFO method. There are many benefits of using FIFO methods but the main reason of suggesting this method is to make sure the inventory received first should be moved first.

This control fulfils the effectiveness goal by the use of FIFO method the first received inventory will be moved out first, so the loss due to expiry, waste, and deterioration can be avoided.

• In catering sub system there is no authorized person for the receiving of inventory (Robert et al, 2016). Anyone, who is working at the catering at the time of delivery of goods, can received the goods and can do the further processes. But there should be an authorized person to who is responsible to receive the goods.

This control ensure security of resources as the missing control plan will make sure the security of resources. The authorized person will deal the process with consistency. Inventory received will be examined thoroughly and will be placed in the correct location. So, this control plan will ensure the security of inventory.

3.5  Conclusion

The quality of the control needs to improve specially in today’s world where technology is getting advanced day by day. The purchasing department is working per the instruction and facilities provided by the management but management should think of the technology they are using and resources which purchasing department needs in order to keep pace with the modern world. Management also needs to renovate their structure of process like the link of purchasing department with the budget etc. Overall, it can be said that yes, the purchasing department is working as per the management’s expectation but management have to look and upgrade their resources as per the requirement of current world.

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