Subject : Accounting Information SystemQuestion : The revenue cycle affects the bottom line of...

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Accounting

Subject : Accounting Information System
Question : The revenue cycle affects the bottom line of thebusiness critically. Hence, there are many threats that couldderail a successful cycle. Describe 5 threats that may hinder thissequence and its compensating controls for each threat.

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1 Sales to customers with poor credit What good sales can do if they are not able to generate cash flows and all the more turn Bad the company wouldnt able to materialise any revenue if the client has a poor track record and isunable to pay Controls Having an independent credit approval function and maintaining good customer accounting can help to prevent problems 2Stockouts carrying costs and markdowns are a threat in the sales order entry process The problem with stockouts is that when goods are not See Answer

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In: AccountingSubject : Accounting Information SystemQuestion : The revenue cycle affects the bottom line of the...Subject : Accounting Information SystemQuestion : The revenue cycle affects the bottom line of thebusiness critically. Hence, there are many threats that couldderail a successful cycle. Describe 5 threats that may hinder thissequence and its compensating controls for each threat.