Internal Control Essay

4. Organisation background inkstand moderate is a manufacturer of re-cycle inkjet and laser t peerlessr printer magazine publishers.inkwell Limited printer cart unfreezege is widely applicable. The master(prenominal) commercial guidance is on strong retail marketplace that demand cheaper and greener products inkstand Ltd has a tally of small principal(prenominal) suppliers that produce4.1 Inkwell Limited is a limited follow, naturalised in 2003. The head office and warehouse is based in Birmingham West Midland.4.2 Their cable model is to offer a damp exchange facility whereby customer any(prenominal) post used cartridge to the bon tons on the line cop or physically take them onto one and altogether(a) of over 60 patronages in the political partys chain that are situated in all major UK cities, and some(prenominal) large t receives. If customers do bring their quondam(a) cartridge in they are past given a 10% synthesis against the cost of a replacement cartr idge.4.3 Its brinys representation is to save customers money by non compromising quality and at the aforementioned(prenominal) eon help ensure a greener environmental future by better use of inkjet and toner cartridge.4.3 Inkwell is a company, in the main owned by shareholders. The managing coach own the most numbers of share, season some(prenominal) the sale commitor and the finance director own equal shares.4.4 The three directors and the company billhookant are the main ending wanton awayrs in the company with the help of managers and supervisors.4.5 The entrepot managers are trustworthy for their own supply by preparing rotas and ensuring adequate provide reportage for all of the opening hours of their crap.4.6 Finance, Marketing and sales are the main departments In appendage a there are a organisation chart.5. Structure and Function of the bill System at Inkwell get together Appendix a for Organisation Chart5.1 Inkwell is a tall expression company. The y are different takes of people, apiece level is get a line by the level above. This real common of such a uncollectible organisation where each(prenominal) level is centralised.5.2 The bill wait on is a small constituent of Inkwell Limited. It consist of Anil Gupta as the Finance Director who his fully amenable for all finance, legal and account statement procedures and formations. This in tail producing the company yearbook report, transaction with all banking and finance issues. Michael OPanye the partnership Accountant, whos duties are producing the monthly steering report, approving all payments to suppliers. However his main role is to manage the build of the accounting technicians and clerks.5.3 Alex Fox, account technician compiling this report, have hunted for Inkwell for the past 6 months reviewing the companys remainss and procedures pin pointing any recommend charges where needed. The main duties thats covered within the account department by new(preno minal)s consist of sales and purchase ledger entries, preparing suppliers payment, payment allocation, cash book entry, subaltern cash summary, cost analyst, bank reconciliation, paysheet run and personal selective information up keep.6. Weakness and finding of the current system6.1 A SWOT analysis has been carried proscribed on the current accounting function in Inkwell showing the Strengths, Weaknesses, Opportunities and panic (Appendix ) From the SWOT analysis it can be seen that there are the following come upon weaknesses in the paysheet process.6.2 System desegregation Whiles the payroll is integrated with the personnel data system, abandoning them to talk to one another, information could be sent from one application to the other, it is not been used to its full potential over receivable to succession consuming caused by escape of experience and knowledge6.3 Hourly paid The weekly hourly paid cater pay is calculated manually from a weekly rota prepared by the shop managers. This situation is not precedent its open to mistakes and potential to fraud. By only installing online time clock terminals lets managers control where employees clock in/out from by setting up specific time clock locations and shift plannings web-based time clock software gets rid of the need for expensive stand-alone equipment while streamlining the process of time sheet charge put uping the payroll clerk to take work data direct to payroll.6.4 Time way The payroll clerk is responsible for managing a weekly payroll Including calculating overtime worked and sales outfit for over 60 shops, two separate monthly payrolls (the match employee is around 180) issues all statutory forms postulate by HMRC, and the annual tax re swordplays, modify and maintaining the personnel database. Managing a vast work load is very difficult and any possible ways of improving the processes to make them to a bulkyer extent efficient should be taken advantage of. By installing a n online time clock terminal can allow mangers to plan shifts automatically. It reduce the time washed-out calculating individual time sheets and allow the payroll clerk the information direct to payroll.6.5 Knowledge The payroll clerk is responsible for the some(prenominal) the payroll and the personnel database which is integrated. As the payroll clerk only had one- daylight in house intensive training rowing on the system therefore the payroll found it difficult to get to grips with both the payroll and the personnel data system after scarcely one days of training. By the company provide training, the payroll clerk can manage more efficient and feel more confident.6.6 Commission All sales module and shop managers earn a instruction of 2% each on the eldest 4000.00 of sales per month, and 5% on any sales over that figure, this is based on for each shop rather than the individual. Inkwell Ltd have over 60 shops, with 3 or 4 employee per shop with annual turnover of 16 m illion drum would suggest the average amount per shop per week is 5,128.00. Every shop staff including managers would be paid commission each month6.7 These four factors outline the main problems affecting the accounting function payroll. The commission to all shop staff is one of most obvious cost effectual that could be saved each month, due to weekly intakes from each shop over 5,000.00. Not only would Inkwell save a great deal of money which in turn could be sent on other things such as improving the implementation of the accounting system.6.8 Cutting the commission to just individual per shop would mean overly the Less time spent preparing the figures for bonuses, more hours gain to do other Things