A proposal for an inventory control model in the context of environmental responsibility and internal audit

Today, there is an age of consumption due to the increasing problems such as developing technology, population growth and urbanisation. For this reason, the rapid depletion of natural resources leads to environmental problems. In order to solve environmental problems, environmental awareness should be increased and responsibilities towards the environment should be fulfilled. The purpose of this study is to investigate the impact of environmental awareness and internal audit on the operational activities of enterprises. For this purpose, a new inventory control model has been developed that includes the repair of defective products within the products received as a result of the order, carbon emissions arising from business activities and internal audit costs. Each batch received as a result of the order is subjected to quality control process. In the quality control process, first type and second type defects are not visible. After the quality control process, good quality products are sold at normal prices. Defective products are taken out of stock for repair. After the repair process, these products are added to the available stock and the demand is met. The retailer is allowed to be out of stock (selling out). The unsatisfied demand is completely fulfilled with the next order. The optimum ordering and maximum stock-out quantities that will minimise the total inventory cost, which includes scanning, repair, stock-out, carbon emission and internal audit costs as well as ordering, purchasing and holding costs that exist in classical models, are obtained by using the classical optimisation method. An applied example is given to show the optimum results numerically and to obtain the total cost and profit values. After the numerical calculations, journal entries were made for purchasing transactions including carbon emission and internal audit costs. Finally, the effect of the model parameters on the optimum solution results is analysed by sensitivity analyses. From the results of the numerical analyses, when the audit cost decreased, the order quantity and the stock-out quantity remained constant, while the total profit increased as expected. When the emission cost ratio decreased, the order quantity increased, but the stock-out quantity decreased. The total profit of the system increased with the decrease in emission cost. When the emission tax cost ratio decreased, the order quantity increased but the stock-out quantity decreased. The total profit of the system increased with the decrease in the emission tax cost.