Big Town Computers has premises in the main street of a large regional city. The business is owned by Max and Betty Waldup, who purchased it three years ago. Betty has an extensive background in IT and has a talent for diagnosing and solving problems with computers that are brought in for repair. Max also has an IT background and oversees the sales and administration staff. There are three staff in the business: a computer technician who assists Betty; a part-timer who helps with sales; and a junior trainee, Sally, who does other tasks, such as banking. Sally is also responsible for issuing invoices and statements to clients who have a service contract with the business. These clients are generally other businesses who ask Betty to visit their premises for routine and emergency repairs, and who purchase software and hardware from the business.
Max and Betty have worked very hard over the last three years, but they have cash flow problems. Their bank manager has requested a meeting to discuss the business' growing overdraft. The bank manager asks Max and Betty to prepare for the meeting by analyzing their accounts receivable and customer receipts. Max and Betty review the accounts receivable ledger and find that it is not up to date. They also discover that client statements have not been issued for four months. They are also unable to identify from the cash receipts journal which clients have paid their accounts.
Required
(a) Discuss the attitude and control consciousness of Big Town Computers' management.
(b) Which duties should be segregated in this business? Recommend an appropriate allocation of duties for the staff at Big Town Computers.