Sy Risk Analysis
Sy’s Fish Company Risk Analysis & Recommendations
As Sy’s business grows there are certain risks and that must be acknowledged and addressed in order to make operations run smoothly and efficiently. Below are the risks that have been identified and recommendations to mitigate them.
Risk: Sending documents to Sy via mail.
There is a high probability that the documents could be lost and therefore the transactions never recorded. Mail can take up to a week to receive so the timing would be affected. Transactions would be recorded in the wrong period and adjustments would have to be made to correct this.
Recommendation:
Sy should implement an information technology system so documents can be recorded in a timely manner and not lost in the mail.
Risk: Return policy
There is not a limit of days a customer has to return the fish. A customer can order fish, and if they are unhappy three months later, they can return the fish for a full refund no questions asked. This is a risk because customers can take advantage of this policy therefore affecting sales revenue.
Recommendation:
Sy sells only fresh fish to customers. Because of this, he needs to change his return policy to 15 days. This will ensure that customers do not wait to return fish months later after the fish has gone bad.
Risk: Bookkeeping and Job Responsibility
All of Sy’s bookkeeping is done by various employees from various stores. Having employees from various locations doing different parts of bookkeeping is risky because not one person is held responsible. Transactions cannot be collaborated from beginning to end until all the paperwork is received from each individual.
Recommendation:
If Sy plans on growing his business he is going to have to hire more employees to help with the bookkeeping.
He should have separation of duties to avoid falsifying of information.
All the bookkeeping should be done in one location.
Internal controls should be set up for the process of recording
As Sy’s business grows there are certain risks and that must be acknowledged and addressed in order to make operations run smoothly and efficiently. Below are the risks that have been identified and recommendations to mitigate them.
Risk: Sending documents to Sy via mail.
There is a high probability that the documents could be lost and therefore the transactions never recorded. Mail can take up to a week to receive so the timing would be affected. Transactions would be recorded in the wrong period and adjustments would have to be made to correct this.
Recommendation:
Sy should implement an information technology system so documents can be recorded in a timely manner and not lost in the mail.
Risk: Return policy
There is not a limit of days a customer has to return the fish. A customer can order fish, and if they are unhappy three months later, they can return the fish for a full refund no questions asked. This is a risk because customers can take advantage of this policy therefore affecting sales revenue.
Recommendation:
Sy sells only fresh fish to customers. Because of this, he needs to change his return policy to 15 days. This will ensure that customers do not wait to return fish months later after the fish has gone bad.
Risk: Bookkeeping and Job Responsibility
All of Sy’s bookkeeping is done by various employees from various stores. Having employees from various locations doing different parts of bookkeeping is risky because not one person is held responsible. Transactions cannot be collaborated from beginning to end until all the paperwork is received from each individual.
Recommendation:
If Sy plans on growing his business he is going to have to hire more employees to help with the bookkeeping.
He should have separation of duties to avoid falsifying of information.
All the bookkeeping should be done in one location.
Internal controls should be set up for the process of recording