Question

Scenario: Company B is a small snowboarding club that offers specialized coaching for teenagers who want to improve their skills. Group lessons are offered every day. Members who want a lesson pay a $15 fee directly to the teacher at the start of the lesson that day. Most members pay cash. At the end of the lesson, the teacher reports the number of students and turns over the cash to the office manager. 1. Based on the scenario, identify the weakness. 2. What could go wrong? 3. Provide a recommendation to address/remove the control weakness

Answer 1

1. Weaknesses can be

• No online payment system
• No online attendance
• Issues in forecasting the revenue

2. As company works on skills development on cash basis there can be chances of underreporting by teacher taking the class as he/she may report less attendance and indulge in cash embezzlement.

3. Things can be done like

• Develop an app/website for online attendance and payment system
• Surprise checking/visits etc.