Please answer question 1,2,3 & 4

IK's Pizza Inc., a pizza take-out and delivery chain, is experiencing decreasing revenues and steadily losing market share despite favorable market testing of its products/recipes.

The company's strategy has traditionally been defined as gaining increased market share through customer satisfaction. Management has asked your internal audit function to help them understand the reasons for declining sales at the Westside location and how the decline might be related to internal operations.

Your prior internal audit experience and direct observation of the work performed at the troubled location identified the following information:

In 2021, JK Pizza's corporate office screened this site location prior to construction to ensure that neighborhood demographics supported the ideal business environment. This resulted in locating the chain near a suburb where typical residents were in the mid-to-upper middle class income range and who owned homes with three to four bedrooms. Despite the favorable location, the site you are reviewing continues to have gross and operating margins lower than their local competitors.

On-the-job training is the primary method used by managers to communicate company policy and procedures. However, documented policies and detailed procedures do exist for each key process and are available by request from]the shift manager. Employees are typically male (comprising 65 percent of the total staff), 17 to 23 years old, with little or no prior work experience at the time of hire. Unscheduled absenteeism is high and part-time shirt assignments are rotated frequently to reward those individuals who regularly work as scheduled. The internal audit team noted in last year's review that management has documented an average annual turnover rate of 18 percent.

The shift manager is responsible for ensuring that all pizza orders are completed within the advertised time deadlines, a long-held competitive advantage. Drivers are required to record on a delivery ticket the time of their arrival at the delivery location. This time is compared with the time recorded on the order ticket to calculate total elapsed minutes. Review of the last six month's delivery tickets indicates that the company benchmark delivery cycle time of 25 minutes from "placing the order to when we're on the doorbell" has slipped to an average of 43.8 minutes. For months there have been persistent rumors about bets placed on one driver's notorious reputation for beating the delivery deadline every time.

Delivery promptness is also dependent on the volume of completed pizzas at any given time and the neighborhood traffic pattern. Drivers are initially screened at hire for outstanding traffic violations or other infractions (such as driving while intoxicated). The original site

manager posted a large map on the wall so that the manager can identify which orders are efficient to group together for delivery. Milage is reimbursed as part of the compensation for using their own vehicles, so each driver turns in a mileage log at the end of the shift to indicate both starting and ending mileage. The manager randomly checks the recorded starting or ending mileage against the cars' odometers.

All drivers are required to have a personal cell phone so as to navigate the various locations and contact customers if the address cannot be located or there are unexpected delays.

JK's Pizza Inc.'s company policy requires that each location restrict itself to a five-mile service area; however, if an order comes in, the work is never refused. Phone and internet orders occur in predictable patterns, but walk-in orders are more random and less frequent. Scheduling staff to match the anticipated workload is done one week in advance. The average workload during peak hours is 35 orders taken per hour. Internet orders are printed out automatically when they come in. Phone and walk-in orders are manually written on pre-numbered pads. When mistakes are made, the original order ticket is tossed out and a new order form is created to avoid confusion. Information captured includes: date, time of call (or walk in), name, address, phone number and the type of crust and toppings requested. Internet orders are automatically calculated and approved if being charged to a credit card. Hand calculators are available to assist with pricing quotes that are told to the customer and recorded on the delivery ticket. Shift managers check every order to ensure that information is complete prior to processing the order.

Employees who make the pizza are instructed in the proper quantity of ingredients for various standard topping combinations. Frequently, special request orders are received that add items to the standard recipe. Measuring cups are available, but your internal audit team noted on prior visits that when activity reaches peak load, employees generally "know" how much of key ingredients to use. The manager monitors the supply cabinets and refrigerators at the end of the shift to ensure adequate inventory is on hand. Several months ago, the evening shift manager determined that inventory deliveries should be increased to four per week, up from the usual three. Oven temperatures are monitored closely to ensure that pizzas are properly cooked. Employees who bake the pizza rely on a centrally located wall clock to time the various combinations. There are cooking guidelines posted for each standard topping combination with instructions on what to do if a pizza is overcooked. Generally, these are available to employees for snacking.

All employees are responsible for ensuring the baked pizzas are cut, boxed, hand-labeled for delivery, and assigned to the next available order. (Drivers take delivery batches as the shift supervisor groups them - but all orders send out for delivery within five minutes of the order being ready).

As leader of the internal audit team, you have agreed to prepare a memo to submit to JK Pizza Inc's CEO, Jade Greinwich, CFO, Clark Kovowitz, and COO, TJ Wheeling, including the following information:

1. Select a key process (one you consider critical to the success of an individual site location) and create a detailed-level process map of the activities involved in that process. This process map must include a key and can contain narrative information to elaborate on the process as necessary. You can create a process map within Microsoft Word or another software of your choosing.

2. Discuss the specific risks associated with the activities of the key process.

3. Based on the case facts provided, identify controls (actions management currently takes) to mitigate the identified risks and label them on the process map.

4. Discuss the audit techniques you recommend for assessing the effectiveness of the existing controls.

5. Based on your observations and opinion of the potential effectiveness of the current risk response activities, create recommendations to mitigate the existing risks and improve performance.

The writing section of this memo must be at least 500 words, professionally written, grammatically correct, and have a logical organization and appropriate flow.

The writing assignment must be formatted as a professional memo and include one process map embedded in the memo or attached separately.

The writing section of this memo must be at least 500 words, professionally written, grammatically correct, and have a logical organization and appropriate flow.