This paper reviews six interconnected case studies in accounting information systems and business operations. The topics covered include eliminating inventory discrepancies through cycle counting and employee accountability, strengthening internal controls to prevent fraud and operational failure, implementing ERP systems effectively using critical success factors, applying the Delphi method for group decision-making, understanding forensic accounting frameworks and the CSI effect, and examining how ERP adoption transforms accounting practices and organizational efficiency. Together, the case studies illustrate how sound processes, technology, and human accountability combine to support organizational health and profitability.
This case study is correct in asserting that properly run inventories are essential to the functioning of any organization. Inventory discrepancies need to be eliminated aggressively in order for an organization to move forward. Furthermore, the case study was astute in asserting that such discrepancies could be avoided by examining past mistakes and working to fix them. The case study was also wise to point out that many inventory mistakes could be avoided by holding more employees accountable. Greater employee accountability is absolutely vital in establishing an environment of trust and efficiency.
However, there are additional tools that can be used to prevent inventory mistakes. One such tool is cycle counting. This process balances the accuracy of all inventory records by determining the number of counted items over the course of a year (Kelchner, 2013). "Companies determine the frequency of material counts according to the cost of the material and the regularity of its use. They may decide to schedule a certain part or other item for frequent cycle counting when counts are often inaccurate. A cycle counting program compares the physical count of an item against the inventory records. Cycle counters investigate the cause of inaccuracies, identifying issues in the inventory management system" (Kelchner, 2013). Such processes ensure a higher level of overall success in the management of tasks and in the way that inventory is checked and double-checked.
Investigation is crucial when discrepancies are found. Limiting staff access to inventory can be effective, as can placing limits on the number of staff corrections that can be made (Ross, 2004). Another effective tactic is routing large-ticket item transactions through managers only (Ross, 2004). Thorough investigations into discrepancies can also reveal weak spots in the overall system.
This case study was correct to cite the work of Gelinas, Dull, and Wheeler in their assertion that a company's system of internal control is designed so that reasonable assurance can be achieved regarding the safe operation of all processes and compliance with necessary laws and regulations. Internal controls are truly essential for the safe operation and overall efficiency of any organization, as well as for evaluating the effectiveness of such an entity.
"A lack of internal controls can cause significant damage to your business. In small businesses, for example, it is not uncommon to have one key employee who conducts financial transactions, makes bank deposits, and balances the books. If you don't have safeguards in place to check on his activities, you may be exposing yourself to deceptive activities on the part of even your most trusted workers" (Joseph, 2013). This demonstrates how the absence of internal controls can cause substantial damage and disruption to an organization. Without them, an organization can quickly become compromised.
This case study should also address how a business can improve the strength and precision of its internal controls — and, with it, likely overall profitability. Several basic measures can assist in this area. For instance, assigning responsibility to specific individuals for compliance with particular regulations, such as safety officers or fire wardens, is vital (CPA, 2008). Creating strong physical controls to prevent accidents is also necessary, as is processing customer complaints and concerns in a fair and timely manner (CPA, 2008). Engaging in well-documented staff feedback procedures and conducting regularly scheduled audits are equally important (CPA, 2008).
One of the most illuminating aspects of this case study is how aptly it reviewed the history of ERP and the critical success factors that connect directly to ERP implementation. This helped offer a clear picture of how ERP systems are both nuanced and vital to an organization, and demonstrated how they can be strongly influenced by certain critical success factors. This understanding is essential, as proper ERP functioning is central to the world of business.
The arena of business and technology is marked by well-known stories of ERP projects that have gone wrong (Kimberling, 2006). Certain well-known companies, such as Hershey's, have been involved in widely publicized lawsuits against ERP software vendors due to botched implementations (Kimberling, 2006). Critical success factors include concentrating on business methods and requirements first, and generating a healthy return on investment through post-implementation performance measurement (Leon, 2008). As one expert notes, "too often, companies get tied up in the technical capabilities or platforms that particular software supports. None of this really matters. What really matters is how you want your business operations to run and what your key business requirements are. Once you have this defined, you can engage in a more effective ERP software selection process" (Kimberling, 2006).
Furthermore, taking ample time to engage in proper planning is necessary for successful ERP implementation. If an ERP vendor's priority is to close the deal, the organization's priority must be to ensure that all aspects of the agreement are thoroughly understood and that there is a clear comprehension of all elements of the business plan (Kimberling, 2006).
"Delphi method benefits and coordination drawbacks examined"
"Fraud elements and CSI effect in forensic accounting"
"ERP streamlines accounting and improves profitability"
You’re 43% through this paper. Sign up to read the remaining 3 sections.
Sign Up Now — Instant Access Already a member? Log inAlways verify citation format against your institution’s current style guide requirements.