Kudler Fine Foods Computer Information System Essay

Kudler Fine Foods (KFF) is a California-based provider of a variety of high end foods, both local and from around the world, founded by Kathy Kudler in 1998. Since the opening of the first location, Kudler has opened two more locations in the San Diego area; Del Mar in 2000 and Encinitas in 2003 (About, 2011). As a growing business, Kudler’s needs are constantly changing, especially in terms of the company’s information technology and information systems. This paper will discuss the needs of the company in regards to business operations and accounting, as well as discuss the strengths and weaknesses of the systems currently in place. Based on the current technological opportunities, suggestions will be made to further improve these systems, and evaluate any threats that may affect these systems. Primary Findings Business and Accounting Needs Business Needs As a retail company, Kudler Fine Foods needs to run as smoothly and efficiently as possible. Kathy Kudler budgeted over $50,000 for Smith Systems to select and install the existing finance and accounting system, called Retail Enterprise Management System (REMS). REMS provides an Point-of-Sale module, or POS module, to automate all retails sales made, in detail. This system automatically reports this data to the accounting modules, as well as manages all credit/debit card transactions made in the stores. This helps to eliminate data entry errors by limiting the amount of data requiring manual input by employees (Accounting System Overview, 2011). Accounting Needs REMS also addresses the accounting needs of KFF, by providing applications for the general ledger, accounts payable, bank reconciliation, asset management and accounting modules. Each of these modules is interconnected with the POS, which allows for direct transfer of data between modules (Accounting System Overview, 2011). General Ledger Module. The General Ledger module includes the chart of accounts, and transaction details transferred y the POS system. This data is used to create the company’s budget and financial reporting. Due to the electronic transfer of data from the POS to the general ledger, this module requires minimal manual data entry (Accounting System Overview, 2011). Accounts Payable Module. The AP module allows for the check disbursement portion of the business to be done electronically. This module holds vendor data, tax and freight data, and accepts data from other modules that directly affect purchasing (Accounting System Overview, 2011). Bank Reconciliation Module. Data from the accounts payable, accounts receivable and purchase order modules are compiled automatically by the bank reconciliation module. This data is used in cash flow analysis for financial reporting (Accounting System Overview, 2011). Asset Management and Accounting: There was no module created for this portion of the business. Kudler needs to develop an efficient and economical way to track inventory and other assets, other than relying on the leasing company and spreadsheets (Accounting System Overview, 2011). Strengths and Weaknesses in the Current System Strengths The strength in the existing information system is that the modules that are installed reduce the manual data entry, thus eliminating unnecessary errors to the information, by allowing the modules to share information provided by the point-of sale machines. The POS system itself is a major benefit to the IT system as a whole, due to the number of transactions it is able to detail, catalog and parse to the interconnected modules. Secondly, the network set up at each location supports 3-4 POS terminals, an inventory terminal and a server terminal. Each individual network, for each store is providing enough storage power for the needs of each location (Information Technology, 2011). Weaknesses As previously discussed, the network setup has benefits on an individual store basis. However, the system as a whole is not sufficient in running a cohesive, multi location business. Kudler’s inventory systems are completely separate from one another, which could cause a serious issue in asset management within the company. A second weakness is the lack of policy regarding security within the system. This could lead to vulnerability to an internet attack for customer personal information and identity theft. Also, without back up procedures, there is no way for Kudler to prevent data loss, should the network(s) fail. Recommendations Based on the information above, the recommendation for Kudler and KFF would be to first, establish a set of security policies and back up procedures, in order to prevent hacking and data loss, respectively. In order to do so, Kudler would best benefit by reestablishing a working relationship with Smith Systems. Smith would then set up and maintain an offsite server that will service all three KFF locations, and allow the company to consolidate the three separate inventory systems. The offsite server would then serve as a repository for all accounting, inventory and human resources related items. Doing so will cut down the potential staffing and duplication in the inventory system. Additionally this would reduce the number of servers required, and thus reduce the potential of IT related hardware issues. Conclusion To conclude, Kudler Fine Foods uses and information system established by Smith Systems that sufficiently handles point-of-service retail sales receipts, and disburses the information to the appropriate accounting software modules. The modules receive the financial data from the sales to create financial reports, budgeting reports, and analyze accounts receivable and accounts payable. The system also maintains ordering and purchase order data, however, it does not maintain a single inventory module, which could track the sales of these items after the goods are received in the individual stores. In order for this to occur, Kudler needs to establish a solid set of security measures and procedures in the case of data loss. To address this, Smith Systems can be contracted to maintain an offsite server with security maintenance. This will help to prevent internet attacks by hackers searching for customer identification and credit card information. Once these changes are in effect KFF should see an increase in efficiency in the current systems in use.