EVALUATION OF INTERNAL CONTROLS OVER THE REVENUE CYCLE: A CASE STUDY OF RETAIL COMPANY X

Abstract

This study evaluates internal controls over the revenue cycle at Retail X, a modern convenience store chain operating a digital ordering application integrated with a Point of Sale (POS) system. The evaluation applies the COSO Internal Control–Integrated Framework/ICIF (COSO, 2013), focusing on two components: Risk Assessment and Control Activities. A descriptive case study approach was employed, with data collected through semi-structured interviews with three informants—the Store Manager, Cashier, and Service Crew—and analyzed using thematic analysis. The findings identify four operational risks: transaction input errors, product preparation errors, order pickup errors, and disruptions in receiving digital orders. These risks stem from employee-customer-system interactions and limitations in human resources and digital infrastructure. Control activities implemented include order confirmation, preparation SOPs, order labeling, product remaking, and manual order verification. However, the evaluation reveals uneven control coverage, heavy reliance on human factors, and a predominance of corrective over preventive controls. By tracing risk from its source to the adequacy of existing controls, this study extends the application of COSO ICIF to digitally integrated retail settings in developing economies. The study concludes that strengthening internal control requires procedural improvements alongside enhanced human resource capacity and information system infrastructure.