Barbara Holmes has recently been hired as the manager of Fresh Start Coffee. Fresh Start Coffee is a national chain of franchised coffee shops. During her first month as store manager, Barbara encountered the following internal control situations:
a. Fresh Start Coffee has one cash register. Prior to Barbara’s joining the coffee shop, each employee working on a shift would take a customer order, accept payment, and then prepare the order. Barbara made one employee on each shift responsible for taking orders and accepting the customer’s payment. Other employees prepare the orders.
b. Since only one employee uses the cash register, that employee is responsible for counting the cash at the end of the shift and verifying that the cash in the drawer matches the amount of cash sales recorded by the cash register. Barbara expects each cashier to balance the drawer to the penny every time—no exceptions.
c. Barbara caught an employee putting a box of 100 single-serving tea bags in his car. Not wanting to create a scene, Barbara smiled and said. “I don’t think you’re putting those tea bags on the right shelf. Don’t they belong inside the coffee shop?” The employee returned the tea bags to the stockroom.
State whether you agree or disagree with Barbara’s method of handling each situation and explain your answer.