THE EVALUATION OF INTERNAL CONTROL OVER CREDIT SALES IN PT. TRI CIPTA TEKNINDO

Abstract

The procedures over credit sales have a significant role in a company activity. Therefore, the internal control based on COSO is needed in order to assure the appropriateness of an internal control over credit sales and to prevent the fraud. With this research, the writer hopes to bring an understanding about the implementation of internal control over credit sales in PT. Tri Cipta Teknindo. Research is done by the writer using a qualitative approach. The process of data collecting and processing include interview, questionnaire, and observation. Interview and questionnaire is done in order to collect necessary information regarding the internal control over credit sales in PT. Tri Cipta Teknindo. On the other hand, observation is done in order to check the communication and the activity are done based on the procedure that the writer receives from the interview and questionnaire result. Based on the writer ‘s analysis and evaluation on internal controls over credit sales in PT. Tri Cipta Teknindo, some findings are found as a result of the weaknesses internal control. The weaknesses are caused by several absence of internal control in the credit sales procedures. The first findings are no credit check approval for customer to prevent uncollectible receivable. Second, there is no segregation of duties between the sales order function and billing function to reduce the possibility of fraudulent activities. Third, there is no external auditor who checks the organization’s financial and business activity company. Fourth findings are miss-keeping documents in sales department to prevent repetition making a document. This condition tends to create an exposure or risk for the company that can increase the firm’s risk to financial losses. The writer recommends the management to do a better internal control. Good internal control will automatically minimize the possibility of fraud. The writer also recommends the management to provide knowledge to the employee regarding the internal control over credit sales.