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Control Mechanisms of Wal-Mart - Case Study Example
Author : mcdermottmittie
Pages 3 (753 words)
The control mechanisms of Wal-mart are regarding parsimonious ways of Sam Walton and technologically advanced policies. These involve internal audit, external audit, market control and financial control. The first control mechanism is about economical ways of distributing and retailing the products…
This made the role of middle men in supply chain activities, as an employee in Wal-mart. After that Wal-mart brought a far larger group of potential consumers within reach of the small commercial centers. This resulted in the control mechanism of building the efficient warehouses necessary for discount operations as part of transactional strategic investments. This can be termed as the control mechanism of buying products from producers directly as the warehousing involves storing the goods economically. (Nelson Lichtenstein, 2005)
The control mechanisms that implement the aspects mentioned in part A can be divided into price, integration, contract and trust developed with communication. These involve internal audit, external audit, market control and financial control.
The internal audit of the Wal-mart involves asset protection. The auditors concentrate on making inventory process efficient in and over the USA. The loss due to shrink, theft and any types of losses or damages are calculated and communicated to the store management to minimize the problems. There are 11 locations of internal audit in USA. (http://walmart.feedroom.com/fr_story=FEEDROOM119269&rf=rss)
The external audit of Wal-mart is responsible for consolidated annual financial statements and so the external auditor. This financial reporting will be according to legally accepted accounting standards. ...