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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › Heraklion S’18
maam in Heraklion co. the sales staff proposes a credit limit which is authorised by the sales director, so then I don’t understand how is it a deficiency? I do get that sales staff have sales target and may propose high credit limits, which may lead to increased irrecoverable debts, but then the SALES DIRECTOR IS AUTHORISING the credit limit before it is set! so then it shouldn’t really count as a deficiency…
The deficiency is that it is set by the sales staff. The director’s authorisation is not sufficient to overcome/rectify this deficiency because he doesn’t have sufficient information on which to make that authorisation.