GONZALES, PIGA, CAMMAYO AND COMPANY

Alimannao Today, Tomorrow the World!

Narrative Report

This walkthrough has been conducted to determine the efficiency and

effectiveness of the company’s internal control. That having been said, we opt to enhance

the lapses, if any, in the company’s internal control. This is to prevent and to be able to

fix any problem that might arise in the near future.

ORDERING

The ordering process depends whether asset is for a new store or an existing store.

For the new store's ordering process, the design and engineering staff of the company

will first have an ocular inspection of the site for preparation of floor plan. The floor plan

prepared and designed by the engineering staff will be reviewed and approved by the

Operations Manager. Upon approval of the floor plan, the ordering process will begin

from the Project Engineer who prepares the Purchase Request that comes in white, blue

and yellow copies. After preparation of the Project Engineer of the Purchase Request, it

is forwarded to the Project Manager for approval. Before approving the Purchase Request

received from the Project Engineer, the Project Manager evaluates whether the requested

assets are in accordance with the companies check list. If the asset is for an existing store

it will depend whether it is an additional or replacement item. The Store Staff will prepare

the Purchase Request and to be forwarded to Store Manager. The Store Manager will

review and approve the Purchase Request received from the Store Staff. If it is approved,

the Purchasing Staff will enter the Purchase Request details to Purchase Request System

or Purchase Request List. After manually inputting the Purchase Request List, the

Purchase Order will be prepared by the Purchasing Staff and will be forwarded to the

Chief Executive Officer of the company. The CEO will verify the Purchase Order. If it is

approved or signed, the Purchase Order will be send to the supplier. If the Purchase

Order is denied the Purchase Order is cancelled and filed.

 GONZALES, PIGA, CAMMAYO AND COMPANY
Alimannao Today, Tomorrow the World!
Narrative Report

RECEIVING

The project manager verifies if the documents and the asset received matched

together. If so, the sales invoice together with the delivery receipt and purchase order

will be signed by the manager and will then proceed to recording. The sales invoice and

delivery receipt, comes in two copies: (1.) White copy that will be given to company and

(2.) Pink copy that will revert back to the supplier. If the documents does not match

together, the sales invoice, delivery receipt and purchase order will revert back to supplier

for follow up.

RECORDING

The Accounts Payable Department will receive the signed sales invoice, delivery

receipt, purchase order and the accounts payable department staff will review if matched.

If the documents matched, the accounts payable department staff will record a journal

entry. If the asset is to be purchased through cash, a disbursement voucher will be

generated by the accounts payable department staff. If on account, an accounts payable

voucher is generated. After which, the documents will be forwarded to the accounts

payable department head. The accounts payable department head will review all the

forwarded documents, if approved: (1.) Cash – the documents will be forwarded to the

disbursement department; the cash accountant will receive the sales invoice, delivery

receipt, purchase order and disbursement voucher. The cash accountant supervisor will

verify the documents and will prepare a check. And (2.) on Account – the cash accountant

will receive the sales invoice, delivery receipt, purchase order and accounts payable

voucher and these documents will be then filed by the cash accountant. The cash

accountant will prepare a check voucher and will be then forwarded to the cash

accountant supervisor. The cash accountant supervisor will verify the documents and

prepare a check and ready for disbursement.

 GONZALES, PIGA, CAMMAYO AND COMPANY
Alimannao Today, Tomorrow the World!
Narrative Report

DISBURSEMENT

After the disbursement, check will be detached and will be given to the supplier.

If cash is being used, the Purchase Order, Sales Invoice, Delivery Receipt and

Disbursement Voucher will be returned to Fixed Asset Accountant who will file and enter

the asset acquired in the lapsing schedule where you can find the list of Property, Plant

and Equipment and Other Assets. If on account, the Purchase Order, Sales Invoice,

Delivery Receipt, Accounts Payable Voucher and Disbursement Voucher will be returned

to Fixed Asset Accountant who will file and enter the asset acquired in the lapsing

schedule. The Fixed Asset Accountant will record and enter the journal entry in the system

DISPOSAL

Store Personnel monitors the performance of Fixed Asset. If it is properly working,

there is nothing to do but if it is not properly working, the store personnel needs to

prepare an Assessment Form that contains reasons why the Fixed Asset is not properly

working and deficiencies of the fixed asset which will be then forwarded to the Store

Manager for review and approval of the assessment form. After approval, the store

manager will determine whether the fixed asset is for disposal or not. If it is for disposal,

the store manager will advise the Fixed Asset Department about the disposal and if not,

it is advised for preparation of purchase request for repairs and maintenance. The Store

Staff prepares the purchase request to be reviewed and approved by the Store Manager.