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  • Prepared For: Puan Khair Shakira Bustamam Prepared By: Anis Shahireen Effah Atiqah Fatinah Husna Nur Fatin

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    Fatinah Husna
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    The document discusses issues found at a lighting logistics company. It highlights misappropriation of assets by senior management, including the CEO claiming higher travel expenses than actual amounts. It also notes weaknesses in the vendor selection process, such as a vendor (Tepat Packaging) consistently providing poor quality materials and being selected despite higher quotes due to the CFO having a partnership with the vendor. To address these issues, the document recommends improving vendor oversight, quality controls, and transparency for executive expense claims. It also suggests steps an auditor, Anna, could take such as reviewing internal controls, conducting proactive auditing, and establishing effective fraud prevention.

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    aud679

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    Lighting Logistics

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    The document discusses issues found at a lighting logistics company. It highlights misappropriation of assets by senior management, including the CEO claiming higher travel expenses than actual amounts. It also notes weaknesses in the vendor selection process, such as a vendor (Tepat Packaging) consistently providing poor quality materials and being selected despite higher quotes due to the CFO having a partnership with the vendor. To address these issues, the document recommends improving vendor oversight, quality controls, and transparency for executive expense claims. It also suggests steps an auditor, Anna, could take such as reviewing internal controls, conducting proactive auditing, and establishing effective fraud prevention.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    798 views9 pages

    Prepared For: Puan Khair Shakira Bustamam Prepared By: Anis Shahireen Effah Atiqah Fatinah Husna Nur Fatin

    Uploaded by

    Fatinah Husna
    The document discusses issues found at a lighting logistics company. It highlights misappropriation of assets by senior management, including the CEO claiming higher travel expenses than actual amounts. It also notes weaknesses in the vendor selection process, such as a vendor (Tepat Packaging) consistently providing poor quality materials and being selected despite higher quotes due to the CFO having a partnership with the vendor. To address these issues, the document recommends improving vendor oversight, quality controls, and transparency for executive expense claims. It also suggests steps an auditor, Anna, could take such as reviewing internal controls, conducting proactive auditing, and establishing effective fraud prevention.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 9

    LIGHTING

    LOGISTICS
    Prepared for:
    Prepared by: Puan Khair Shakira
    Anis Shahireen Bustamam
    Effah Atiqah
    Fatinah Husna
    Nur Fatin
    1. IDENTIFY THE MISAPPROPRIATION OF
    ASSETS BY SENIOR MANAGEMENT
    HIGHLIGHTED IN THIS CASE.

    The CEO claim higher than


    actual travel expenses One of the partners of Tepat
    RM31,300 for February and Packaging is CFO the quote
    RM22,600 in March where of Tepat Packaging is higher
    actual expenses RM3,000 in than other vendor
    February and RM4,200 in eventhough Tepat Packaging
    March. consistently delivered bad
    quality materials and
    insufficient inventories.
    2. WHAT ARE THE WEAKNESSES IN THE
    VENDOR SELECTION PROCESS? HOW CAN
    THESE WEAKNESSES BE ADDRESSED?

    Not always have sufficient


    Delivered poor quality material inventory for deliveries

    Weaknesses

    Even Tepat Packaging provided


    the best quote as explain by because Tepat Packaging Sdn
    CFO, but Tepat Packaging Sdn Bhd is a partnership with
    Bhd (vendor) were on average Lighting Logistics (CFO)
    15% higher than quotes from
    other vendors
    2. WHAT ARE THE WEAKNESSES IN THE
    VENDOR SELECTION PROCESS? HOW CAN
    THESE WEAKNESSES BE ADDRESSED?
    Recommendations

    CFO need to re-examine the vendor selection process


    Improve the visibility into the product quality
    Improve the manufacturing and distributing of the product
    Effective training for vendor by provide periodic training session, tests and awareness
    programs for vendor
    Make sure that all vendor are up-to-date with relevant policies, contract and
    regulations for reduce the nonconformity, product defects and rework costs
    3. WHAT CAN BE DONE TO ENSURE THAT
    THERE IS TRANSPARENCY IN THE EXECUTIVE
    EXPENSE CLAIMS PROCESS?

    Provide full disclosure of the receipts and other relevant documents for
    the expense claims. All expenses claims should be disclose publicly.
    Provide a clear policies and processes documents need to be signed and
    verified by top management.
    Assign clear roles and responsibilities segregation of duties
    Comply with the professional code of ethics integrity, objectivity,
    confidentiality, competency
    Holding Company need to monitor Subsidiary Company do surprise visit
    4. WHAT ARE YOUR THOUGHTS ABOUT ANNA USING
    SOCIAL MEDIA TO GATHER INFORMATION?

    I think it is a good alternative to gather information


    Social media has become important source for investigation
    Social media help auditor to analyze and measure the event
    Give continual story through social media
    5. WHAT DO YOU SUGGEST ANNA
    SHOULD DO IN THIS SITUATION?
    Misappropriation of assets
    Solutions Explanations
    Review internal control Evaluate the effectiveness of IC
    system system
    Conduct proactive Search misappropriation of assets and
    auditing information misrepresentation
    Using CAAT techniques and data
    mining
    Establish effective fraud Knowing the organizations strength
    prevention and weaknesses
    Provide consulting expertise
    5. WHAT DO YOU SUGGEST ANNA
    SHOULD DO IN THIS SITUATION?
    Expenses claimed by CEO

    Solutions Explanations
    Identify and collect more Check with airplanes tickets or
    information regarding customer services department
    travel expenses
    Corporate governance Find out there are conflict of interest
    management and threat to independent by CEO,
    CFO and previous CAE
    THANK YOU

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