Question

Lily went to a store today. She had to pick up a computer that the Geek Squad can't fix. I walked out with the computer in my arms. No bag. No receipt. Security did not stop me.Analyze what is wrong with this store from the perspective of audit？

Answer 1

It is absolutely imperative for the security to check the purchases with the receipts at their door.

The first, risk significant point to be noted here is that the store is not providing with the receipt which can become problematic for the store later on if the customer denies that he/she hasn't picked the product (here computer).

Another, difficult point would be that it would become difficut for the store to prepare its financial statements with supporting evidences. If the transactions are not supported with the evidences then auditors can't rely on the transaction occured.

Another important point is that security is not stopping the customers which shows that there is control deficiency and this may lead to losses to the store if the security remains ignorant as some customers might take extra goods which are not actually purchased. Thus, security should always cross check the goods pirchased by customers with the receipt they are carrying.