Maclary Computers has premises in the main street of a large regional city. The business is owned by Henry and Indiana Maclary, who purchased it three years ago. Indiana has an extensive background in IT and has a talent for diagnosing and solving problems with computers that are brought in for repair. Henry also has an IT background and oversees the sales and administration staff. There are three staff in the business: a computer technician who assists Indiana, a part-timer who helps with sales and a junior trainee, Savannah, who does other tasks such as banking. Savannah is also responsible for issuing invoices and statements to clients who have a service contract with the business. These clients are generally other businesses that ask Indiana to visit their premises for routine and emergency repairs and that purchase software and hardware from the business.

Henry and Indiana 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’s growing overdraft. The bank manager asks Henry and Indiana to prepare for the meeting by analysing their accounts receivable and customer receipts. Henry and Indiana 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 Maclary Computers’ management.

(b) Which duties should be segregated in this business? Recommend an appropriate allocation of duties for the staff at Maclary Computers.