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Question 1 (11 marks) As an Accounting Information System expert, you provide consultancy services to various clients in Australia. MPS Limited is one of your clients, and Miss Angela, the head of its accounting department, is concerned about the revenue cycle's business processes and data related operations. Therefore, she has recently contacted you to evaluate their revenue cycle. You asked Miss Angela to provide the system flowchart of the business activities involved in their revenue cycle. Miss Angela has prepared the following Figure 1: System Flowchart for you. Activity Performed (sequential, left-to-right across all rows) Employee Sales Clerk Sale > Credit No Receive Customer Order Prepare Sales Order Limit? Issue Credit Memo Warehouse Clerk Pick & Pack Order Yes Shipping Clerk Ship to Customer Credit Manager Approve/ Deny Credit Accountant Prepare & Mail Invoice Customer Update Accounts Receivable Update Accounts Receivable Deposit Remittances in Bank Monthly Cash Collections Clerk Receive Remittance from Customer Stamp "For Deposit Only Receive & Reconcile Bank Statement Figure 1. System Flowchart of the Revenue Cycle Activities Required: a) Describe potential internal control weaknesses in the above activities of MPS Limited. [4.5 Marks. Word Limit: Up to 150 words] b) Discuss the potential risks associated with the internal control weaknesses identified in Section (A) above. [4.5 Marks. Word Limit: Up to 150 words] ANSWER b): c) Based on Section (B) above, what types of frauds are possible. Hint: we have discussed different types of frauds in the interactive tutorial and lectures. Your discussion should be based on these contents. [2 Marks. Word Limit: Up to 150 words] ANSWER C)

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