Rainbow Illusion is a renowned retail store operating in different locations of Victoria and New South Wales. The organization gas recruited skilled and competent employees such as sales personnel, cashier and assistant manager to maintain the sales transactions of the company. The assistant manager is given a special responsibility to review the cash history generated by the cashier in response to the sales rate of the merchandise. The assistant manager prepares a reconciliation report of the bank statement so that Rainbow Illusion has a record of overall sales transactions made in the organization.
Rainbow Illusion is a retail organization operating about 30 stores in Victoria and New South Wales. The company manufactures garments for young females. It holds an effective account management system to control sales transactions. Rainbow Illusion has hired a full-time store manager and a part-time manager who are provided with a fixed salary and lucrative incentives. The study highlights the efficiency of the sales transaction team of the organization who is competent to maintain a steady cash flow to the organization. Additionally, the report outlines the effective internal control measures adopted by the Rainbow Illusion to avoid deterioration in the revenue flow of the organization.
Rainbow Illusion has appointed full-time managers, as well as assistant managers who are paid a fixed salary. The sales personnel and cashiers are young people, who work on a part-time basis and are paid hourly wages and additional incentives that are dependent on sales volumes. The organization uses unworldly cash registers having four-half sales invoices that record every transaction of the company. The sale invoices are used extensively besides the different payment types such as cheques, cash, and bankcard (Ogiela, 2015).
The sales personnel present on the sales floor manually check the records of the multiple transactions. This includes clothes, descriptions, class, quantity and the unit price. Additionally, the salespersons are able to check the employee numbers who are assigned a specific task to evaluate everyday records. The total number of the sales invoice is calculated by the salesperson when the discount is implemented and accurate sales tax is calculated (Anaya et al., 2015). This repetitive checking of the sales outcomes helps Rainbow Illusion to tackle a monthly track of the financial status of the organization.
The salesperson provides a sales invoice to the cashier and retains one copy of the sales transcript in the sales book. The cashier is given the responsibility to review the invoice and hence, the input of the sales is evaluated. Additionally, the cash register is always updated that validates the monetary transactions made by the organization. This assigned a consecutive number to the proposed transaction. The sales rate is enhanced when the cashier gets credit approval with respect to the charge sales and approved sales that are paid by cheques (Shanks et al., 2018). Furthermore, the cashier provides one copy of the invoice to the clients and retains another copy as an evidence of an authentic transaction.
A third copy is generated for the bankcard when a deposit is under need. On the other hand, returns are tackled in an opposite manner. In this case, the cashier issues a return slip in response to a monetary transaction. Rainbow Illusion maintains a steady cash flow in their organization where the cashier sequentially maintains the transcript of each sale invoice. Moreover, he acquires cash register to generate an estimated value for the last month's sales transaction of the company. This is done to provide an estimated measure for bankcard, cash, cheques, credit and cash returns. The total amount is reviewed by the assistant manager with respect to the cash register tapes (Pearlson et al., 2016). This is accompanied by the total number of sales invoices and the return slips stocked by the organization.
In response to the review produced by the store manager, the assistant manager generates a daily restoration report. Besides preparing the report, the assistant manager is assigned the responsibility to review cheques, cash, and sales rate of the credit card. After that, he designs the total amount for daily bank deposits, including the credit card sales invoices of the deposits. The manager presents an authentic deposit slip in front of the higher authorities of Rainbow Illusion after making the deposition of the cash at the bank. The sales invoices, cash register slips, and return slips are forwarded to the central headquarters of Rainbow Illusion for thorough processing. Through this advanced and rapid monitoring, Rainbow Illusion is able to identify its strengths with respect to sales transactions.
In this context, the data processing unit of Rainbow Illusion returns a weekly commission and sales rate report to the unit manager for a thorough analysis of the sales transaction report. Thus, Rainbow Illusion holds an effective accounts department that manages every monetary transaction of the organization. From the revenue management of Rainbow Illusion, it is evident that multiple analyses are carried out that determine the cash flow of the firm.
Cash is regarded as the liquid asset of a business and a business unit cannot sustain itself in a competitive market if it is unable to control the cash. Vovchenko et al. (2017) stated that cash is the only asset in a business that has a high chance of going missing if the business organization does not have control over the cash processes. Based on the opinion of Forsgren and Sabherwal (2015), cash involvement is the main factor that enhances the business performance of an organization. Thus, besides other assets, cash is the most mishandled asset subjected either to carelessness or to theft. In this regard, an internal control policy must be adopted by the organization so that they can avoid the mishandling of the important asset of the organization. This denotes the efficiency of business management to handle cash flow competently and effectively (Fu, 2017). Similarly, Rainbow Illusion has developed specific internal control processes that have helped the company to avoid losses and hence, could have controlled the sales transactions. The internal control measures developed by Rainbow Illusion are as follows:
Establishing unique protocols- Rainbow Illusion has created specific internal controls by establishing specific procedures and protocols for the workforce to follow. Rainbow Illusion has informed its workforce about the protocol that they need to follow to maintain a steady cash flow to the company. Rainbow Illusion revealed that a disciplined approach towards sales transaction management would bring cohesiveness and order to the organization (Akhmetshin et al., 2019). Based on the opinion of Forsgren and Sabherwal (2015), the organization has designed specific protocols that help the cashier to follow unique procedures to evaluate the monetary transactions of the organization.
Prevention of theft and fraud- Rainbow Illusion has established internal controls that have helped the organizations to reduce or prevent theft and fraud within the company. The assistant manager of Rainbow Illusion is assigned with the responsibility to maintain the reconciliation of the bank statements. Thus, it can be uncovered if the organization’s money is being misused by the employees or management.
Segregation of organizational responsibilities- Rainbow Illusion has appointed different skilled and competent employees to enhance the revenue flow of the organization. This responsibility is mainly associated with the sales transactions as Rainbow Illusion is a retail company having about 30 stores in Victoria and New South Wales. The organization has appointed cashier, salesperson and assistant manager to handle specific positions within the company. This has helped the organization to avoid thefts and internal frauds (Forsgren and Sabherwal, 2015).
Maintenance of financial and management data- Internal controls established by Rainbow Illusion helps them to maintain its management and finance information in an organized manner. Thus, organized data has enhanced the productivity of the company and has helped them to prepare their business strategies to grab important information from the market. It is predicted that Rainbow Illusion has provided the authority to the employees to generate their own password to access data and files on the organization's system. Based on the opinion of Forsgren and Sabherwal (2015), this has helped the company to create a monthly financial system both online and on an offline basis.
Effective training and development- It is believed that Rainbow Illusion has provided effective training and development sessions to its employees to manage their tasks efficiently. As the organization has segregated job responsibilities, every employee of specific job profiles is provided with training so that they can handle their responsibilities effectively. An efficient training session helps the employees to reduce errors in their work. As manual works are associated with computerized entries, special training sessions are provided to the employees of the organization.
There are many situational pressure and those can be considered as the aspects that can increase the likelihood of fraud in the organization such Rainbow illusion. In addition, it can be said that this part of the report has been given two types of situational pressure.
Based on the opinion of Forsgren and Sabherwal (2015), bad situation is one of the prime causes that direct an individual toward taking a bad decision. In this regard, it can be said that during stressful situation, people think that fraud is one of the main way in order to remove the issues. In addition, this can be said that spouse, friend or relative can enforce an individual down the path of fraudulent. In this context, this can be told that pressure can enforce diversity of the response of human. This is the prime reason behind the increment of internal fraud. There are some sorts of fraud and those are given below.
a Internal theft for the property of business
b Claiming for the advantages
c Mistreatment of the vacation time
d Taking the advantages of travel
Based on the opinion of Akhmetshin et al. (2019), explanation can be taken place in differ forms and this can be said that sometimes it becomes a justification. In this context, it can be said that a person will move toward fraud if he or she does not become able to get the thing that they desire. In addition, it has been found that after spending lot of effort and time, if any one does not get the required things, which they want most then they will automatically turn in the direction of fraud. On the other hand, this can be said that fraud cannot be considered as the cause of theft for the big dollars.
This are the two indentified situational pressure and this can be said that it is highly required to be considered by the Rainbow illusion in order to prevent fraud.
Reasons for companies to install a distributed computer system rather than a centralised one
In distributed computer system multiple computers perform to produce a single task. All the computers of this system want to achieve the same goal in a more diversified way. The geographic range covered by this system is huge and for that reason time is consumed very less in this particular system. Rainbow Illusion chooses this distributed computer system rather than centralized system for performing their work. This particular system has many privileges. Firstly, in distributed computer system, computers work as a single system and for that, if any of the computer fails to perform or crashes down, no big problem can be occurred due to this issue. Data can be recovered from other computers present in that system, whereas in centralized system this problem use to occur very regularly and the company is using this system faces a huge loss in data and time. For any natural disaster, like calamity, fire or water breakage all data can be lost for the centralized system, for that reason a huge back up storage in secondary location is needed but in the case of distributed system no such problem is happened (Colaso et al. 2019).
Rainbow Illusion also use this distributed computer system for another reason. In this system work is done in a very fast process rather than the single centralized one. In this system if any query is asked to a particular local server then it can be solved in that particular moment but in centralized system, all queries have to be reached at one particular system, then a huge amount of problems gathered for solving. For that any particular local issue needs a huge amount of time to be solved. After having a speedy internet connection due to this huge overload of data, bottleneck and traffic in network happened in a regular way for the centralized system but in the distributed system no such problems occurred at all which means in less time more and more work can be done (Shimizu and Fujitsu, 2018).
The distributed system is well designed and for this reason, it is very easy to access and distribute data in all the servers involving in this system. It has a huge plus point for this system rather than the centralized one (Plante, 2018).
The centralized system has more and more disadvantages. It requires a large amount of data storage to store all the data. It needs high cost for data transmission. Whereas in the case of distributed computer system no such problems are observed in here. So, using this particular system Rainbow Illusion take a very bold and firm step to improve their business management (Athirah et al. 2019).
In centralized system there is a huge risk in security issue as the virus attack in the specific system is easier rather than the distributed system. In distributed system if any particular virus attacked in any individual system, then it has a more easy way to denaturalize and disinfect that particular system without creating much problems. So, in a better way distributed computer system give a better safeguard to the computers rather than the centralized one.
The study explores the effective accounts management system established by the Rainbow Illusion to control sales transactions. Rainbow Illusion has appointed different personnel to manage the cash flow system of the organization. The organization has appointed cashier to evaluate the records of cash, cheques, bank transaction, and other monetary transcripts. Additionally, the organization has appointed an assistant manager to review the overall sales transaction and monetary system to generate a financial report for the company. This evaluation
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