Question $4(25$ marks$)$

Datin Shima has operated a traditional Malay Cuisine business under the name of Selera

Kampungku since two years ago. The restaurant is located in the town of Ipoh. The

restaurant workers work on a shift basis. Workers, during every shift consist of $4$ chefs, $6$

waiters and $1$ cashier. Datin Shima has recently consulted you to overcome some of the

major problems in her business. Based on the discussion, the following issues were

discovered:

Datin Shima is currently dealing with poor attendance of the waiters. Therefore, she

required each worker to record the time when they arrive and leave the restaurant in an

attendance register.

Datin Shima also complained that the amount of cash collection is not satisfactory

although the number of customers is on the increasing trend. She suspected that one of

the cashiers must have misappropriated the collection from customers but did not find

any evidence to substantiate the claim.

According to Datin Shima, customers order will be recorded by any of the waiters ona

customer order form, which is then handed over to the chefs at the kitchen. Afterthe

meals were delivered, any three $(3)$ of the experienced waiters will determine worte the

price on a bill that is given to the customer. The other waiters are not allowed to

determine price. When making payment over the counter, the customer is required to

present the bill to the cashier. The cashier is required to immediately record the

collection from every customer in a cash receipt register. In case, where the bill is

misplaced by the customer, the cashier would issue a new bill based on confirmation

from the customer. At the end of every shift, the cashier would count the cash

collection and compared the amount with the receipt. The physical cash would then be

handed over to Datin Shima. Datin Shima is comfortable with the system because no

shortages were noted so far.

Datin Shima also suspected that the chefs might have stolen some of the inventory

items such as chicken, prawns and fish. These items were normally delivered directly

by the appointed suppliers to any of the chefs at the kitchen.

Required:

a$.$ Explain FIVE $(5)$ major weaknesses in the internal control system of Selera

Kampungku, and recommend FIVE $(5)$ control procedures that should be

implemented to overcome each of the weaknesses.

b$.$ Discuss THREE $(3)$ objectives of designing an effective internal control system to

the management.