Day: February 11, 2026

The following process describes aspects of the purchase system in operation at Alex plc:

For the process, select whether it represents a significant strength, a significant deficiency, a minor impact or no impact on the system.

• The company buyer orders new inventory over the telephone, initiates orders herself, and maintains a record of telephone orders.

Select ONE answer:

1. a significant deficiency
2. a minor impact
3. no impact
4. a significant strength

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Deficiency – although a record of orders is kept, there is a lack of segregation of duties as the buyer both places and authorises the order. A director should authorise purchases (particularly those above a certain cost limit) rather than the buyer.
2. Not correct
3. Not correct
4. Not correct

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