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Goods dispatch notes (GDN) are given the same number as the order number to which they relate.
The sales invoices are only raised on receipt of a GDN, and without separate sequential numbers, it is difficult for Amberjack Co to identify if any GDNs are missing as they are not likely to be raised in the same sequence as the sales orders.
If GDNs are missing and the company fails to raise invoices in a timely manner, this could lead to a loss of revenue.Maam i just can’t understand how having same sequential numbers of GDN and order forms is a problem/control deficiency in any way?? i am finding this explanation very confusing!
Could you possibly explain this with an example?
ABC Co raises sales orders (SOs) ….
2054
2055
2056
2057
2058
2059
2060
2061
…
As goods are dispatched it raises GDNs …
1004
1005
1006
1008
1009
1010
Can you see the missing GDN? There shouldn’t be missing GDN #s because they should be raised in strict numerical order. That’s why it’s important to identify gaps – if any (and hopefully none).
Now suppose the same despatches were given the same # as the SOs:
2058
2055
2059
2060
2061
2057
When you have reordered the numbers – what do the gaps in #s tell you? Only that most likely the GDNS have not been raised (for SOs not yet fulfilled).
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