Accounting Information Systems Simulation Summary
Internal Control Systems are processes put in place to safeguard the company. In the simulation, the task was given to help a new company set up an internal control system, implement control procedures for specific internal control issues, and manage the internal control system as the company continues to grow.
Ramos International is an up and coming luxury hotel in Chesapeake, Virginia. The role given in this simulation is that of the Chief Financial Officer (CF), who is to help put internal controls in place for this company. With any company, work assignments are structured to divide activities among employees so no one employee has single control over an entire process.
There are three key processes to focus on, and they are purchasing, cash receipts, and payroll. In the simulation, job responsibilities had to be identified for each position within a certain department. For purchasing, it was determined the Merchandise Buyer would issue the requisition, the Purchasing Manager would approve the invoice, the Accounting Clerk would update the Accounting Information System (AIS), and the Storekeeper would receive the goods. The division of these responsibilities proved to be effective with minimal risk.
The second set of jobs was in the Cash Receipts area. It was determined the Accounting Clerk would update the AIS, the Head Cashier would make the deposit, and the Accounting Manager would manage the Bank Account. The third set of jobs in the Payroll area where the Payroll Clerk would process time cards, the Payroll Manager would review payroll, the Accounting Clerk would update the AIS, and the Chief Financial Officer would approve the payroll. All of these divisions of responsibilities proved to be effective with minimal risk.
Over the past three years, Ramos International has expanded by adding nine more hotels in six cities. The internal control system has not been able to keep up with the...
References: Bagranoff, N., Simkin, M., & Norman, C. (2008). Core concepts of accounting
information systems. New York: John Wiley & Sons, Inc.
University of Phoenix Simulation Exercise (2013). Retrieved from www.phoenix.edu.
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