Case 3.6 Buranello's Ristorante
Case 3.6 Burnello’s Ristorante
1. Identify internal control weaknesses evident in Buranello’s operations. What risks are posed by these internal control problems?
a. Too many people have access to the register. This makes pointing responsibility and guilt harder. This makes culprits harder to find.
b. Management only counts the register each day and has variances then. This makes the entire day’s events impossible to detect when an event occurred that would cause a shortage.
c. The reconciliation page doesn’t have a comments section. This could help identify why misstatements are occurring.
d. The morning management recounts the amount and brings the money to the bank seemingly alone. This gives opportunities for theft like the sting idea Barnes had.
2. For each internal control weakness you listed in responding to the previous question, identify a measure that Buranello’s could implement to remedy that weakness. Indicate whether these measures would be cost effective.
a. Putting passwords on the registers and reducing access to personnel would be easy but possibly expensive to add a security program to the computer. However, the register should already have a password system to prevent people who aren’t workers from accessing the register. Therefore it should be easy and cost effective to implement. All it would require would be stricter management.
b. Management could count the draw each time there is a shift change. This is easily inexpensive to implement. Designating a register per worker using it helps identify who is responsible for the draw. But this would still require implementing my first control.
c. Adding a comment section and beginning use of it would be easy to add and inexpensive as well.
d. Using a coworker witness to sign off the count of the drawer could help prevent this. It may be time consuming but this is usually implemented in most businesses I have worked for that required use of a register.
3. Prepare a list of internal
1. Identify internal control weaknesses evident in Buranello’s operations. What risks are posed by these internal control problems?
a. Too many people have access to the register. This makes pointing responsibility and guilt harder. This makes culprits harder to find.
b. Management only counts the register each day and has variances then. This makes the entire day’s events impossible to detect when an event occurred that would cause a shortage.
c. The reconciliation page doesn’t have a comments section. This could help identify why misstatements are occurring.
d. The morning management recounts the amount and brings the money to the bank seemingly alone. This gives opportunities for theft like the sting idea Barnes had.
2. For each internal control weakness you listed in responding to the previous question, identify a measure that Buranello’s could implement to remedy that weakness. Indicate whether these measures would be cost effective.
a. Putting passwords on the registers and reducing access to personnel would be easy but possibly expensive to add a security program to the computer. However, the register should already have a password system to prevent people who aren’t workers from accessing the register. Therefore it should be easy and cost effective to implement. All it would require would be stricter management.
b. Management could count the draw each time there is a shift change. This is easily inexpensive to implement. Designating a register per worker using it helps identify who is responsible for the draw. But this would still require implementing my first control.
c. Adding a comment section and beginning use of it would be easy to add and inexpensive as well.
d. Using a coworker witness to sign off the count of the drawer could help prevent this. It may be time consuming but this is usually implemented in most businesses I have worked for that required use of a register.
3. Prepare a list of internal