Reference no: EM132805587

You are working as an accountant for a small training organisation called The Train Station. The CEO has approached you with the following issues:

1. Several invoices have been received recently that have no prior approval from management for purchase
2. One of the staff members was paid at the incorrect pay rate as the payroll officer processed pays based on information the staff member provided rather than the employment contract
3. Cash flow and profit and loss reports are not being reviewed regularly
4. Staff are unsure who they can seek approval or guidance from, as there is not a clearly delegated role

• The CEO has decided to appoint a Chief Financial Officer (CFO), who will have high level approval responsibilities and assist to control business operations. The CFO will now become the delegated person responsible for all financial purchases, queries and monitoring.
• The CEO has requested that you help to resolve the above issues by developing new Control Procedures that address the issues. You are also asked to write several reports that will be used in the development and implementation of the new procedures.

Problem 1. Develop two internal control procedures to resolve the issues regarding unapproved purchases and payroll processing.