Required: As an IT Auditor, identify the problems/weaknesses in the development of the new system and provide control recommendations to AVC. Use the format below: System Development Problems/ Weaknesses Audit Recommendations Process Project initiation System Analysis & Design Construction Testing & Quality Assurance Implementation
Audio Visual Corporation (
Headquartered in Boston, it has seven sales offices with nearby warehouses that
carry its inventory of new equipment and replacement parts. AVC has a
departmentalized manufacturing plant with assembly, maintenance, engineering,
scheduling, and cost accounting departments as well as several component parts
departments.
When management decided to upgrade its
headquarters and local area networks at each sales office. The IS manager and four
systems analysts were hired shortly before they integrated the new computer and
the existing AIS. The other IS employees have been with the company for years.
During its early years, AVC had a centralized decision-making organization. Top
management formulated all plans and directed all operations. As the company
expanded, decision making was decentralized, although data processing was
highly centralized. Departments coordinated their plans with the corporate office
but had the freedom to develop their own sales programs. However, information
problems developed, and the IS department was asked to improve the company's
information processing system once the new equipment was installed.
Before acquiring the new computer, the systems analysts studied the existing AIS,
identified its weaknesses, and designed applications to solve them. In the 18
months since the new equipment was acquired, the following applications were
redesigned or developed: payroll, production scheduling, financial statement
preparation, customer billing, raw materials usage, and finished goods inventory.
The departments affected by the changes were rarely consulted until the system
was operational.
Recently the president stated, ''The systems people are doing a good job, and I
have complete confidence in their work. I talk to them frequently, and they have
encountered no difficulties in doing their work. We paid a lot of money for the new
equipment, and the systems people certainly cost enough, but the new equipment
and new IS staff should solve all our problems.''
Two additional conversations regarding the new AIS took place.
BILL TAYLOR IS MANAGER AND JERRY ADAMS, PLANT MANAGER
Jerry: Bill, you're trying to run my plant for me. I'm the manager, and you keep
interfering. I wish you would mind your own business.
Bill: You've got a job to do, and so do I. As we analyzed the information needed for
production scheduling and by top management, we saw where we could improve
the workflow. Now that the system is operational, you can't reroute work and
change procedures because that would destroy the value of the information we're
processing. And while I'm on that subject, we can't trust the information we're
getting from production. The documents we receive from production contain a lot
of errors.
Jerry: I'm responsible for the efficient operation of production I'm the best judge
of production efficiency. The system you installed reduced my workforce and
increased the workload of the remaining employees, but it hasn't improved
anything. In fact, it might explain the high error rate in the documents.
Bill: This new computer costs a lot of money, and I'm trying to make sure the
company gets its money's worth.
JERRY ADAMS, PLANT MANAGER AND TERRY WILLIAMS, HUMAN
RESOURCES MANAGER
Jerry: My best production assistant, the one I'm grooming to be a supervisor, told
me he was thinking of quitting. When I asked why he said he didn't enjoy the work
anymore. He's not the only one who is unhappy. The supervisors and department
heads no longer have a voice in establishing production schedules. This new
computer system took away the contribution we made to company planning and
direction. We're going back to when top management made all the decisions. I
have more production problems now than I ever had. It boils down to my
management team's lack of interest. I know the problem is in my area, but I
thought you could help me.
Terry: I have no recommendations, but I've had similar complaints from
purchasing and shipping. We should explore your concerns during tomorrow's
plant management meeting.
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