Beyond Inventory: Internal Control as an Efficiency Driver in Merchandise Accounting

Abstract

The aim of this research project is to establish internal controls over accounting processes that will optimise the stock management at the Representaciones Galvis, C.A. service station. This study was undertaken in response to the researcher’s concern, having observed the company’s need to implement appropriate internal controls to minimise the risks inherent in the area of stock management. To gather this information, an analysis was carried out of the company’s operations in order to identify strengths and weaknesses in the stock inventory process, as well as to assess the opportunities and threats facing the company; In turn, the organisational structure within the warehouse area was examined to ensure that the segregation of duties was correct, and every process used was observed from the moment the goods are purchased until the product is sold. Following the application of the methodology, it was observed that there is inefficiency in the control mechanisms, both in terms of merchandise supervision and accounting systems, as well as in the documentation handled by staff when carrying out the necessary activities in the goods flow. These findings were obtained and observed using a survey-based data collection technique, which consisted of a questionnaire comprising dichotomous questions. The study adopted a descriptive research approach, in the form of a feasibility project. Upon weighing the strengths, weaknesses, and other characteristics mentioned in the study, it is concluded that the company must implement accounting processes to maintain control over its inventory activities, thereby increasing its efficiency, efficacy, effectiveness, and security.