Internal Controls for Problem 3
Theme park operators must be aware of the fact that rides maintenance is a very important function of a theme park, as a malfunction in any component of the rides could very well escalate into a potentially dangerous situation. The simplest method to minimize ride breakdowns is by establishing a reasonable set of internal controls that will be able to efficiently overcome the problem. Under the component of control activity, Legoland can implement three features of the internal control system, namely physical control, personnel control and management control. Firstly, under physical control, Legoland has to set up proper measures to safeguard its assets – the rides and attractions. A good way to do this is to…show more content… An ERP system is better than several stand-alone systems because it is multi-module and facilitates integrated and real-time business processes. Besides, if it is provided in the market, the company should use bolt-on application software which is from the same vendor, so that integration can take place smoothly between the system and the additional supporting application software. Another outstanding point for ERP implementation is the built-in audit trail function that enables financial transparency where it drills down from a report to the source documents (transactions) that created it, making it easier for auditors to confirm the integrity of the reports. Its archiving function (permanent storage) enables the system to keep track of when dates are created or changed, helping forensic accountants to trace potential fraud and manipulation. Knowing that Legoland has its own website, with ERP system implementation, it can use Extensible Markup Language (XML) to help code data directly from its webpage into its…show more content… More importantly, Legoland may not be able to constantly introduce new rides every year if they do not have the means to do so due to low level of revenue generation that may be caused by low level of demand by the people. Henceforth, managers must always keep in mind that the output of the theme park’s whole operating system is happy and satisfied customers who enjoy their experience at the park. Among the results of satisfied customers would be repeated visits from them and their help to attract new visitors through word-of-mouth recommendations