Final Exam Chapter 8 Flashcards
is a recurring set of business activities and related information processing operations associated with providing goods and services to customers and collecting their cash payments
revenue cycle
what should be don if there is inaccurate or invalid master data
employ data processint integrity controls
restrict acces to master data
review all changes to master data
what should be done if there is unauthorized disclosure of sensitive data
physical and logical access controls
encrypt data
what should be done if there is loss or destruction of data
back up data
implement disaster recovery plan
what should be done if there is poor performance issues
use managerial reports to evaluate company and individual performance
take order approve credit check inventory availability respond to customer inquires
sales order entry
pick and pack goods and ship them
shipping
invoice customer and update accounts receivable
billing
receive payments deposit funds and update accounts receivable
cash collection
what are the 4 parts of the revenue cycle
sales order entry, shipping, billing, cash collection
what do you do if there is an incomplete or inaccurate customer orders
completeness checks field checks close loop verification validity checks reasonableness checks
what do you do if there is invalid orders
require signed purchase orders from customers for paper based orders or use digital signatures
what do you do if there is uncollectible accounts
approve sales on credit for each customer
set credit limits
require specific authorization for approve sales over the customers limit
monitor customers balances with regular accounts receivable aging reports
what do you do if there is stockouts or excess inventory
maintain accurate inventory records
use the perpetual inventory method
use barcodes or RFID tags
train employees about inventory control procedures
conduct periodic physical counts of inventory
develop accurate sales forecasting models
what do you do if you are loosing customers
use CRM systems
establish a chat feature, FAQ page, and access to secure customer account information of the company’s website
evaluate customer service ratings
what do you do if you are picking the wrong items or the wrong quantity
use bar codes and RFID tags
reconcile picking tickets to sales order details
what can you do if you are having problems with theft of inventory
restrict physical access
document all inventory transfers
use bar code and RFID technology
conduct periodic physical counts of inventory and reconcile to recorded quantities
What do you do if you are having shipping errors
reconcile sales orders picking tickets packing slips and bills of lading
use RFID systems to identify delays
enter data using bar code scanners and RFID
empty data entry edit controls (field checks, validity check, completeness check etc.)
configure computerized and paper based systems to prevent duplicate shipments
what do you do if you are having problems sending bills to customers
separate billing and shipping departments
compare sales orders, picking tickets, and shipping documents with sales invoices to identify any shipments that have not been invoiced
what do you do if you are having problems with billing errors
configure system to enter pricing data automatically
restrict access to pricing master data
employ data entry edit controls
reconcile shipping documents to sales orders
what do you do if you are having errors in posting to accounts receivable
use data entry controls
reconcile batch totals
mail monthly statements to customers
reconcile subsidiary accounts to the general ledger
what do you do if you are having inaccurate or invalid credit memos
segregate credit memo authorization function from both the sales order entry and customer account maintenance functions
configure the system to block credit memos unless there is either corresponding documentation of return of goods or specific authorization by management
what do you do if you are having a theft of cash
separate the cash handling function from the accounts receivable and credit function
regularly reconcile the bank account with recorded amounts using someone independent of the cash collections procedures
mail room controls - cameras, multiple people in the room
use cash registers
deposit cash daily
what do you do if you are having cash flow problems
use lockbox arrangements, EFT, or credit credit cards
allow discounts for prompt payment by customers
prepare cash flow budgets
