Sales Order Processing

The Company “A” sells products according to customers’ sales orders. There is no defined Sales and Receivable procedure within the Company however “A” has enough experienced staff who can proficiently manage sales processes.

Orders are obtained from bothforeign and domestic customers via fax or e-mail. A specific customer agreement is not signed with any customer and there is no standard sales order form. Each Customer Sales Representative (CSR) is responsible from a particular group of customers. The CSRs are assigned to customer groups verbally, there is no approved or formal document that defines responsibilities of CSR’s. Orders are first received by Marketing Department and then directed to the related CSRs.

CSRs create a sales order in the ERP system. Only Sales Department have authorization to create a sales order in ERP. Sales orders are approved first by the sales manager, then by the Credit Controller and CFO subsequently. If the sales order amount exceeds 2 million, CEO approval is also required. If any change is needed after approval, they are made on the sales order (price or quantity). No further approval is required.

When the CSR enters an undefined customer on ERP while sales order creation, a warning message is shown and the transaction is not permitted.

Unit price is automatically created on Sales order however CSRs can manually edit unit price on sales order. The information mail is sent to Sales Manager and related CSR but there is no approval system.

Customer name, shipment address, foreign or local customer info, technic material info, currency and pricing date info is entered to sales order on system. System automatically gives a number for each sales order and these number is not editable.

Discount

if the customer is company's dealer, %4 and %6 discount rate for A type dealer and %3 and %2 discount rate for B type dealer is defined in the system Every sales staff can modify the discount rate on system. These changes are reviewed quarterly by the Sales Manager and CFO.

New Customer Procedures

There is a new customer procedure within the company. According to the procedure, all customer records are created in the ERP system. The customer acceptance is done by Sales Department. The customer is required to demonstrate some documents such as tax signboard, circular of signature, official gazette notices, letter of credit etc. All customers are divided into regional groups. The regional group responsible is assigned verbally, without any approval. There is no formal document regarding his/her responsibilities within customer creation process.

Anyone from the Marketing department can create customer in the ERP system. There is no customer master data approval. The system assigns a unique number to each customer master data. There are required fields such as company name, addresses, tax number, etc. for customer master data creation and unless the template is completed, system does allow to create customer master data however doesn’t allow to create a sales order for that specific customer.

For each customer a risk limit is defined by the Finance Department with the cooperation of Sales Department. These credit limits are sent to the sales department monthly. If the amount in sales order exceeds the credit limit, Sales order is locked and only CFO can unlock the sales order.

Shipping Procedures

All final products are sent to “09 packing unite” after production process. The products are stocked up according to customers.

To start the shipment process, the CSR reviews the Sales and Shipment Report on ERP. CSRs prepare a ship order in ERP system and forward it to the Shipping Department. Products are bar-coded and loaded to trucks according to the ship order. Also via barcode scanner, products are scanned and accordingly a separate packing list is produced. The packing list is used by warehouse personnel to ensure that accurate products are loaded for delivery.

THIS IS MY INTERNAL AUDIT HOMEWORK,WHAT IS THE METHODOLOGY AND SCOPE OF THIS CASE?

Answer rating: 100% (QA)

Methodology of Internal Audit WORK OR SCOPE Of Intunal Audit Work 1 formal Sales Order Documentation ... View the full answer