Go to a local retail business, such as a bookstore, clothing shop, gift shop, grocery store, hardware store, or car dealership. Ask to speak to someone who is knowledgeable about the store's methods of internal control. After you and other members of the class have completed this step individually, your instructor will divide the class into groups. Group members will compare their findings and develop answers to the questions that follow. A member of each group will then present the group's answers to the class?
1. How does the company protect itself against inventory theft and loss?
2. What control activities, including authorization, recording transactions, documents and records, physical controls, periodic independent verification, separation of duties, and sound personnel practices, does the company use?
3. Can you see these control procedures in use?