Congratulations! You are fast becoming a raising star as a Staff Auditor at Levin
& Associates, LLP. Your supervisor, Mr. Lee, arrives at your office early Monday
morning and states he was so impressed with your last project for the Lending
Club that he wants to see how well you can work with a team of other high
achievers within the company.
Further, Mr. Lee says, “I will be assigning you to a team shortly, but first, I’d like to
share some additional information about the new client and the project. The new
client is a small wine producer in the Finger Lakes Region of New York State that
must keep track of its business processes and operate necessary accounting
functions. The Finger Lakes Wine Company (FLWC) grows grapes, produces
wine, sells wine tastes, runs a gift shop, and operates a restaurant. FLWC sells
wine at retail prices through the gift shop and restaurant to customers who visit
the winery. In addition, FLWC sells wine at wholesale prices to distributors, liquor
stores, night clubs, and restaurants in the Rochester metropolitan area.”
Mr. Lee continues, “the Managing Partner, Corky Winepoper, designed the
database with no knowledge of accounting or information systems. As a result,
FLWC management is trying to operate the company with a poorly designed
database. FLWC is experiencing many problems such as stock-outs and a
physical inventory count that does not reconcile to the inventory balance in the
accounting records. In addition, other business processes are also operating
poorly. For example, payroll checks are frequently incorrect, vendor invoices are
paid late, production costs are not tracked, and management has no confidence in
the reliability of the financial statements.”
Mr. Lee concludes by saying “the partners of FLWC would like to expand its
market to Syracuse, Oswego, Buffalo, Niagara Falls, and Toronto. However,
Corky is too busy tasting wine to fix the database problems. Accordingly, your IT
audit team has been assigned to re-design the database that can support the
expansion with an enterprise information system. Your team’s design will be
presented to Corky and FLWC management.”
Sample Solution
