I.

II. Risk assessment procedures.

BUSINESS RISK – INHERENT RISK

Explanation Level of risk Relevant assertion

Risk descriptions affected
FSs level Assertion level

Business risks Inherent risks

Binh An is a stock In case the As a x
company with 60 company has consequence,
shareholders the large the profit of
number of the company
shareholders, will be
in order to overstated
have a good
financial
performance ,
management
will face with
the pressures,
result in the
risk of fraud,
making up the
FSs
The company operating The products The profit of Inventory accuracy
in the retail industry, of the the company (lower of cost and
selling cell phones and company are will be NRV)
accessories. very specific negatively
since it can be affected
In recent years, inventory out of date or because the Income
has been in slow-moving obsolete in inventory
condition due to the short term. can’t be
competition. estimated at a
appropriate
value.
Goods if provided by a It takes time Risks of cut- Inventory payables Cut-off
variety of foreign to import off inventory,
suppliers. good from purchases and
oversea. In payables may
addition, good not be
in transit for a accurate.
longtime will
affected the
risk of not
meeting the
requirements
of customers,
resulting in
loss of
customer
goodwill
Binh An has many big It is hard for If the x
store in bis cities over the company to accounting
contry. supervise the systems is not
internal unified among
control, it will stores, it is
increase the difficult to
risk of fraud prepare FS
and the and FS may
company may not give true
not have the and fair view.
same
accounting
systems for
every stores
because of the
Corporate
laws in each
city.
Although having The new
competition , stores may
management still made not operate
decision to open some effectively
new stores. because the
operating
expenses of
these stores at
the early stage
may not be
carried.

CONTROL RISK

LEVEL OF RISK
Relevant assertion
RISK DESCRIPTIONS EXPLANATION FSs level Assertion level affected

The decision of The control environment is not X

management was still good. BOD doesn’t advisory
implemented although the decision of BOM. BOD
shar3eholders’s interest doesn’t examine the design
was not satisfied oversight and the control
performance. BOM are
overriding existing controls.
Inventory in the The controlling inventory inventory existence
warehouses is not system is not strong and it is
classified reasonably not time-efficiency to pick out
according to descriptions the inventory the customer
of each types of want to buy, classify, select
categories. and count in the end of the
period.
Management of Binh An This case will lead to some Inventory existence
seems not to consider the risk:
security condition in the Risk of misappropriation of
warehouses. assets, because of the
+, cameras have not opportunity aspect of fraud
worked for months triangles, employee can take
+, employees can enter fraudulent actions.
the warehouses without
any restriction.
All purchases are That responsibility may not be Inventory
approved and initiated by fulfilled because CFO may
the vice CFO lack of skills and experience.
He can’t make reasonable
predict about the sales trend,
which product is interested by
the customers. Therefore, he
can’t determine exactly
quantity of good to order and
chose the suppliers.
Prenumbered receiving The Prenumbered receiving Inventory accuracy
report is only sent to report should be copied and
accounting also sent to Purchase
department, Warehouse and
Accounting department. In this
case, there is no cross check,
the accountant may record the
entries inaccurately related to
inventory.
Sometimes goods The requirements of purchase Inventory Completeness
received can not be order may not be met about the Accuracy
examined fully by the quantity and quality of
receiving department. received goods.
The goods in the This is a good opportunity for Inventory Completeness
warehouse under control warehouse manager due to Accuracy
of warehouse manager lack of separate of duties. The Existence
and are updated by workload of warehouse
perpetual record, and the manager is too much so he
manager used it to may not possible the control
determine the reorder all the amount of good to
good level reorder.
The perpetual records Because the company uses the Inventory Accuracy
only contain physical perpetual record so it is Completeness
quantities of inventory necessary to continuously
without description and update quantity, qualities and
quality. descriptions of inventory to
ensure that inventories meet all
the requirements.
Payable accountant It needs more supporting Inventory Completeness
compares vendor’s documents to compare such as Account payable Accuracy
invoice to the purchase receipts and the risk of
order inappropriate recording will be
higher.
In April and December Risk of fraud, the chief Account payable Accuracy
2018, the CEO went away accountant can overstate cash Cash/bank
on business, the payment disbursement, and this a good
for suppliers was opportunity for him/her to
approved by the chief misappropriate cash.
accountant.
The chief receives the Both the duties of recording Bank Accuracy
monthly bank and reconciling bank may be
reconciliation directly taken by the chief accountant.
from the bank. The bank reconciliations
should be review
independently by the CFO
with his signature on the bank
reconciliation.
The monthly AP listing is The errors is hard to be Bank Accuracy
not used in Binh An co so detected and they can not Account payable completeness
the difference in data determine exactly the payment
between the bank and which was made to each
company is difficult to vendors.
detect.

PRELIMINARY ANALYTICAL PROCEDURES

ITEMS/ RATIOS ANALYSIS Realated Risk
account rating
balances/
2018 2017 2016 problems
Draft Actual actual

Turnover 44,540 42,920 40,012 The turnover of 3 years are not much low
different, and the figure of 2018 is
higher than that of 2017 therefore it
can indicate that the business of
company is improved
Gross profit 7,078 7,140 7,423 The Gross Profit of the company Inventory high
witnessed a decrease during 3 years. It
shows that the COGS increased and it
leads to a problem about value of
inventory.
Net profit 519 1,150 1,201 The net profit before tax of 2017 and High
before tax 2016 are relatively same but it
decreased significantly in 2018 nearly
a half. The auditor should find the
reasons.
Total assets 27,727 25,136 24,500 The amount of total asset increased in Medium
2018 and the auditor should determine
whether the increase in current asset
or the inventory.
Current 1,012 1,377 1,378 The figure in 2017 and 2016 are Current asset low
ratio nearly the same but it decreases Current
moderately in 2018. It indicates that liabilities
the liquidity in short term of the
company higher in 2018.
Quick ratio 0,321 0,519 0,527 The quick ratio in 2017 and 2016 Going high
remained stable at approximately 0,5, concern
but this figure decline significantly to
0,321 in 2018. And in 3 years these
figures were lower than 1 it means
that the company's financial situation
is in a state of weakness, unable to
immediately pay short-term debts.
Especially, the reducing in 2018
indicates that the number of
inventories increase, the risk of
obsolete is rasing.
Inventory 3,353 4,355 4,301 The inventory turnover in 3 year quite Asset low
turnover high, this figure was stable in 2017
and 2016 and it saw a decrease in
2018.
This large coefficient shows that the
turnaround speed of goods in
warehouses is fast. The higher the
number of inventory turnover, the
faster sales and inventory are not
stagnant. This means that the business
will be less risky if the inventory item
value in the financial statements is
decreasing over the years.
’’Net 230,777 11,892 11,901 The NWC measures the liquidity of Current high
lworking times Times Times the company and is calculated from assets
lcapital the balance sheet. Current
l(NWC) The NWC in 2016 and 2017 remained liabilities
lturnover’’ stable but it significantly raise nearly
19 times in 2018. It shows that the Going
company run business efficiency. But concern
audit term still have to pay attention to
Going concern situation.
 III. AUDIT SCOPE

The scope of audit is the determination of the scope of activities and the period of time that the records must
be audited.
Legal requirements.
Entity aspects.
Reliable information.
Appropriate communication.
Evaluate.
Check.
Compare.
Decision.
1. INVENTORY:
- Control lover lreveiving lgoods lactivities
- Control lover lrecording linventory
- Account lbalances

2. ACCOUNT lPAYABLE l
- Control lover lpayment lactivities
- Account lbalances l
IV. MATERIALITY
A. Overall materiality
-turnover is a appreciate indicator to assess high level of operation and reflect volumn of good purchased.
- gross asset value is reasonable ratio in manufacturing environment and practical where “return on assets” is
important ratio.
- Net Profit before tax useful where return on equity investment is important because Binh An Co. is a listed
company.

- relevant percentage:
Turnover : 0,5% - 1%
Gross profit: 0,5% - 1%
Net profit before tax : 5%

Calculation of Quantitative Materiality in 2018:

Criteria Value in 2018 ($) Percentage Quantitative

material($)

Turnover 44,540,000 0.7% 311,78

Gross profit 7,078,000 0,7% 49,546

Net profit before tax 519,000 5% 25,950

Calculate the quantitative materiality level:

311,78 +49,546+ 25,950
’Quantitative lMateriality llevel l= l l= l$129,092
3
 => Overall Materiality = 129,092 * 80% = $103,27

B. Performance Materiality

Performance materiality (which, as defined, is one or more amounts) is set to reduce to an

appropriately low level the probability that the aggregate of uncorrected and undetected.
misstatements in the financial statements exceeds materiality for the financial statements as a whole
- undetected misstatements:
+ this is the first year AIC audit Binh An Co so they will find it hard to understand the management system of
Binh An co, the risks may be out of control of auditors, and they are impossible to detect all risks.
+ uncertain about the Financial Statement whether it is true and Fairview or not.
+ the honesty of the management, and accountant.
=> undetected misstatement is accounted for 10% of overall Materiality.

- uncorrected misstatement.
For retail company like Binh An co. they will accept to adjust 70% of the adjusted entries given by the
auditors.
=> uncorrected misstatement will affect 20% of overall materiality
=> performance Materiality 70% * overall materiality = 70% * 103,27 =$72,289
 2.
TEST OF CONTROL
Inspection :
 ’Inspect lthe lCounting
lreports land lInventory
lbalances lof. lFor lany
ldifference, lobtain lthe
lexplaination lfrom lmanager
land ltheir lsolution. ’
l under only the control of warehouse
 Check the internal
verification instructions
 ’Inspect lall ldocumenations
lrelated lto lPayment
lprocess.If lcontrol lis
leffective, lthere lneed lto
lhave la lseparation lof
lduties. l’’
COLLECTED EVIDENCE
 Goods is provided by a variety of foreign
suppliers.
 At the year end, there is a risk that the cut-
off inventory, purchases and payables may
not be accurate.
 In recent years, inventory of Binh An has
been in slow-moving codition due to the
competition of Binh An’s rivals
 inventory can’t be valued at a appropriate
value, and profit of the company may be
affected.
 The goods are stored in the warehouses
manager. Only warehouse manager update
the perpetual record, and use it to determine
the recorder good level.
 This is a good opportunity for warehouse
manager due to lack of separate of duties.
 The perpetual records only contain physical
quantities of inventory, but no description
and quality.
 Differences between the physical count
results and the inventory balance are
recorded as operating expenses.
 When a vendor’s invoice is received, the
payable accountant compares it to the
purchase order and then records the
transaction in the purchase journal and
related records.
 In April and December 2018, the CEO went
away on bussiness , she made payment
were not approved by CEO but by the chief
accountant.
Observation: ’’
 Observe lthe lInventory
lcount. lIf lthe lcontrol lis
leffective, lthe ldifferent
ltype lof linventory lis
lclassified lin lspecific larea
lwith ldetail ldescription.
+ Camera system has not worked for months
+ Employees can enter in warehouses without any
restriction
Re-performance :
 Select la lsample lof
lprenumbered lreceiving
lreport, lcheck lto lfind lthe
lrepective lcopy lof lthese
ldocumentations lin
lPurchase ldepartment,
lWarehouse land lAccounting
ldepartment.
Inquiry :
 Enquiry lof lstaff lin
receiving ldepartment about
the lprocess and the
instruction lof receiving good
lthat they lare following.
 ’Enquiry lthe lManager
labout lthe lInventory
lcontrol lsystems, lthe lstaff
lwho lresponsible lfor
 Binh An’s inventory is not classified
reasonably according to description of each
of type of categories.
 The controlling inventory may not strong
enough, leading to waste of time of picking
inventory, sorting and counting in the end
of the period.
 The security condition in the warehouse is
not considered:
 It is good opportunity for employees to
undertake fraudulent action.
 The receiving department only count
quanlity of goods when they receive
 CFO is responsible for approving all the
purchase order.
 CFO may not have enough skills and
experience to fulfill that responsibility.
 Sometimes goods received cannot be
examined fully by receiving department
 The received goods may not meet the
requirements of purchase order about
quality and quantity.
 ’The lgoods lare lstored lin lthe
lwarehouses‘’ l‘’under lonly lthe lcontrol
lof lwarehouse‘’ lmanager.‘’Only
lwarehouse lmanager lupdate lthe lperpetual
 ladministration lof linventory
Enquiry lWarehouse
lManager labout lthe lprocess
land lcriterial ltha lthis
ldepartment luse lto
ldetermine lreorder lgood
llevel
 Inquiry CEO, the payable
accountant, the chief
accountant’’
lrecord, land luse lit lto‘’ ldetermine lthe
lreorder lgood llevel.’
 The monthly payment listing is not used in
Binh Anh Co becausing having differences
between data in the bank and Binh Anh’s
notes.

SUBSTANTIVE lTEST lFOR lINVENTORY

FS’s AUDIT OBJECTIVES AUDIT PROCEDURES

ASSERTIONS
‘’Existence l‘’ lInventories are record Observe lthe lphysical
purchases and sales of inventory lcount.’’
transactions.
lInventory lon lthe lBalance
lSheet lphysically lexists. l’’
‘’Completeness l‘’ Purchases land lsales of Trace lthe ltested lamount lto
ltransactions lare’recorded. l’’ lthe ldetailed linventory-listing.
Inventorieslat lthe lend‘’of l’’
lthe lyear lis lshown lon lthe
lBalance lSheet. l’’ l’’

‘’Valuation l‘’ ’’Costs of inventory are Inspect of thelinventory

valued laccurately
lsuitable with’accounting
lstandards. l’’
Inventory existed in the
warehouse at the end of the
period should lbe lvalued lat
lthe lLower of Costland
NRV. l’’
listing, ensure that the totals
agree to lthe Inventory general
lledger. l’’
’’Cast lthe ltotal lof linventory
llisting‘’to l‘’make lsure lthat
lit l‘’is lmathematically
lcorrect. l’’
’’Vouch la lrandom‘’sample lof
linventory litems lto‘’
l‘’suppliers’s linvoice‘’to
lguarantee lthat lit lis lexactly
l‘’valued lat lcost. l’’

’’Inquiry lmanager lof lBinh

lAnh lCo.l lto lascertain lany‘’
 l‘’slow-moving lor lobsolete
linventories‘’that lshould lbe
l‘’written ldown. l’
’’If lsignificant llevels lof
inventory lremain lunsold lfor
l‘’an lunusal lperiod lof ltime,
lshould ldiscuss lwith‘’
l‘’management land lconsider
lthe lneed lto lmake
l‘’allowance lfor lthese
linventories. l’’
‘’Cut-off‘’ Accountant recorded all the ’Note lthe lnumber lof lthe
transaction related to purchase lReceiving l lreporting
and sales inventory at the on- land’Purchasing lreport‘around
time period. lthe lyear to ensure that all of
these transactions are included
in the correct accounting
period.l‘’ l’’ l
l‘’Classification Accountant properlylclassified ’Examine lthe‘’Note lto lFSs
inventory by account lto lensure‘’that lall lthe
system.ll lsectors l‘’relating lto
lInventory lis lproperly
All the neccessary information lclassified land lfully‘’
related to classification an l‘’disclosured lin lthe lNote lto
valuation of inventory are lFSs’’
fully is closures in the Note to
Financial statements.
 SUBSTANTIVE lTEST lFOR lACCOUNT lPAYABLE

FS’s AUDIT AUDIT

ASSERTIO OBJECTIVE PROCEDURES
NS S
‘’Existence ’Account ’’Select a sample lthe‘’trade laccount‘payables
l- lpayables lare llisting‘’and l‘’accruals llisting
lOccurence‘ lvalid ’Obtain lselected‘’supplier’s lstatement‘’and
’ lliabilities l‘’reconcile l‘’these lto lthe lrelevent lsuppliers’s
laccounts. l’’
Purchase
transaction‘are ’Perform lAnalytical lprocedures by‘’comparing
recorded lhave lcurrent lyear lbalances lto‘the lprevious lyears
loccurrred land lto‘’confirm l‘’reasonableness.
lrelated lto lthe
lentity’’
Completene ’’All lCasting lthe llist of l ltrade lpayables ’and l‘’agree
ss lpurchases lthe ltotal l‘’to lthe l‘’general lledeger.
ltransaction ’
lthat lshould ’’Inquiry lof lmanager lon‘’how they ’identifiy
lhave lbeen land‘’examine unrecorded lliabilities‘’which occur
lrecorded lare lpost lyear-end
lrecorded’’ ’’Inspect a number
oflsuppliers’statement‘’and’reconcile l‘’these lto
’’All lpayables lthe‘’relevant lsuppliers’ laccount. l’’
lhave lbeen ’’Perform Analytical procedures by
lrecorded’’ compareingthecurrentyearbalancesfortradeaccountp
ayablesandaccrualstothepreviouslyear.
’’All
ldisclosures Check to ensure that all the neccessary information
lrequired lhave related to liabilities are fully disclosured in the Note
lbeen to FSs.
lincluded’’

‘’Valuation All laccount ’’Trace l‘’selected lsamples lfrom lthe ltrade

l‘’ lpayableslinclu laccounts‘’ l‘’payable llisting lto lthe lsupporting
de the ldocumentation‘’ l‘’ l(purchase lorders, l‘’minutues
laccounts lof lauthorizing‘’ l‘’expenditures,
atlappropriate lsuppliers’invoice). l’’
lamounts’’
’’Obtain l‘’selected lsuppliers’s lstatement‘’and
lreconcile l‘’these lto lthe lrelevant
 lsuppliers’accounts. l’’

’’Compare lthe‘’current lyear lbalances lfor ltrade

laccount‘’ l‘’payables land laccruals lto lthe
lprevious lyear. l’’
‘’Cut-off‘’ ’All ’’Note lthe‘’number lof lthe lReceiving
lpurchases‘’tra lreporting‘’and‘’ l‘’Purchasing lreport larround lthe
nsactions lhave lyear land land lcheck lthat l‘’these lhave lbeen
lbeen lrecorded lincluded lin lthe lcorrect lfinancial lyear. l’’ l
lin the correct
period
‘’Accuracy ’’Amount ’’Cast lthe llist lof laccount lpayable, lagree lthe
l‘’ relating lto ltotal lto‘’ l‘’general lledger, lto lensure lthat lit lis
ltransactions‘h lcorrect. l’’
ave lbeen
lrecorded ’’Select la‘’sample lof laccount lpayables‘’, lfind la
accuracy’’ l‘’respective lsupporting ldocumentations‘’. l’’

Financial
linformation‘is
ldisclosed
lfairly land lat
correct
amounts

‘’Classificat ’’Purchase ’’Inspect lto‘’ensure lthat lall lthe linformation

ion l‘’ l‘’transations lrelated lto‘’ l‘’account lpayable lare lfully
lare lrecorded ldisclosured‘’ lin lthe‘’Notes lto l‘’the lFSs. l’’
lproperly‘’in
lthe laccounts’’ ’’Enquiry lmanager lfor lany lmissing linformation.
l’’
3. Prepare a draft audit report

AUDITOR’s lREPORT
TO lTHE BOARD OF DIRECTOR,ll BOARD OFlll MANAGEMENT, SHAREHOLDERSlOF
lBINH lANllCOMPANY

“We have audited the 2018 Financial Statements, including: Balance sheet at 31/12/2018,
report on business results, cash flow statement and Notes to financial statements ended on the same
day, of the Binh An Co. (hereinafter referred to as "Company") , attached from page 05 to page 198.”

The Board of Diretor’s Responsibility

“The Board of Directors is responsible for making and presenting honestly and reasonably
financial statements of the Company in accordance lwith Vietnamese Accounting Standards, the
Vietnamese Corporate Accounting System and related legal regulations published by Vietnamese
Ministry of Finance. Moreover, the Board of Directors is responsible for internal control that they
confirms to ensure that the preparation and presentation of financial statements are free from material
misstatement, whaterver it is fraud or error.”

Auditor’s Responsibility

“The responsibility of the Auditor is to give his own independent opinion abour the financial
statements, based on the results of the audit. We conducted our audit in accordance with Vietnamese
Auditing Standards. These standards require auditors to comply with standards and regulations on
career ethics and planning and perform the audit to obtain reasonable assurance about whether the
financial statements are freefrom material misstatement or not.”

“The audit involves performing procedures to collect audit evidences about the data and notes
on financial statements. The procedures are selected relying on auditor’s judgements, including the
assessment of risks of material misstatement on financial statements, whatever it is fraud or error.
While performing this assessment, the auditor reviewed the internal control of the Company relating
to the preparation and presentation financial statements honestly and reasonably for the design of
inspection procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used an the reasonableness of accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.”

“We guarantee that the audit evidences we have obtained are sufficient and appropriate to use
as basis for our audit opinion.”

Auditor’s Opinion

“In our opinion, except for the effects of the matter described in the Basis for
Qualified Opinion section of our report these financial statements present fairly, in all material
respects, the financial position of the Company at 31 December 2018 and its financial
performance and cash flows for the year then ended in accordance with Vietnamese Accounting
Standards, the Vietnamese Corporate Accounting Sytem and the requirements of Vietnamese
Ministry of Finance.”

Basis of the Opinion

“Errors were found in the payable ledger. Moreover, the individual accounts of suppliers
make up the trade payables balances, the total of which is material to the statement of financial
position. In addition, by taking physical count, we have found that a large portion of inventory may be
obsolete.”

Hanoi, May 13, 2019

Independent Auditor
AIC Vietnam

(signature)

Auditor’s name
4. Draft suitable management letters in relation to a statutory audit for Binh An Company

AIC Vienam
XY - Main Street
Hanoi
Vietnam
Tel: (abc) wxyz-abcd
Fax: (###) ####-####

General Manager
Binh An-Joint Stock Company
218 Lo Duc - Hai Ba Trung
Hanoi
Vietnam
May 13, 2019

Dear Mr.ABC,
“We have recently completed the audit in accordance with Vietnamese Standards on Auditing
the financial statements of for the year ended 31 December 2018, and have issued our report thereon
dated 17 March 2019. An audit involves performing procedures to obtain audit evidence about the
amounts and disclosures in the financial statements.” The procedures selected depend on our
judgment, including the assessment of the risks of matenal misstatement of the financial statements,
whether due to fraud or error. In making those risk assessments, we considered internal control
relevant to the Company's preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the‘ circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company's internal control. Accordingly, we do not
express an opinion on the effectiveness of the Company's internal control.
“During our audit, we noted certain matters involving internal control and other operational
matters that are presented for your consideration. These comments and recommendations have been
discussed with the appropriate members of management and their formal responses have been
incorporated into this report from the attached letter. These comments and recommendations are
intended to improve internal control or result in other operating efficiencies and are summarized in the
attached file below.”
“Our audit procedures are designed primarily to enable us to form an opinion on the financial
statements, and therefore may not bring to light all weaknesses in policies or procedures that may
exist. We aim, however, to use our knowledge of Company gained during our work to make
comments and suggestions that we hope will be useful to you.”
“We would be pleased to discu s these comments and recommendations with you at any
time.”
“This communication is intended solely for the infollllation and use of management, the
Office of Inspector General, others within the organization, the Govemment Accountability Office,
and the U.S. Congress, and is not intended to be and should not be used by anyone other than these
specified parties.”

Yours truly,
(signature)
 Weakness
Inventory System Classification Inventory in the warehouses
is not classified reasonably
according to descriptions.
Warehouse The security condition in the
control warehouses is not considered:
(Physiccal) +Camera system has not
worked for months
+Employees can enter in
warehouses without any
restriction
Recording - The perpetual records only
System contain physical quantilites of
inventory, but no description
and quality.
- Only warehouse manager
update the perpetual record,
and use it to determine the
reorder good level
Purchase Payment CFO is responsible for
System approving all the purchase
order.
Implication
The controlling inventory
is not strong enough
leading to waste of time
of picking inventory,
sorting and counting in
the end of the period.
- The goods are
stored in the
warehouses
under only the
control of
warehouse manager.
- According to Fraud
Triangle, it is a good
opportunity for
employees to undertake
fraudulent action –
missappropriation of
assets
The current stiuation of
inventory in the
warehouse may not be
fully controlled, leading
to the confusion in
determining reorder level,
as well as rasing the risk
of missapropriation of
assets.
- CFO may not have
enough skills and
experience to fullfill that
responsibility. l’’
- He can not make
appropriate predictability
Recommendation
There need to have a detail
instruction in controlling
inventory, including
classification, a regular check
the compliance with this
instruction should be regularly
undertaken.
- Warehouse need a lock
system lwith lparticular
password, land lonly la small
lnumber lof lstaff lknow lit.
- Camera lsystems lin lthe
lwarehouse lshould lbe lin
lwork lat lany ltime.
- There lneed lto lhave lmore
lstaff lin lwarehouse lto ltake
lthe lresponsibility lof lcontrol
linventory. lAn lindependent
lcheck lover lthis lshould lbe
lregularly lundertaken lby
lInternal lAudit
It need to continously update
both quanlities, qualities and
description of inventory to
ensure that Inventory may not
be misstated.
Purchase manager should take
the duty of approval Purchase
order, he should evidence his
approval lby lway lof signiature
on each order.
 about the selling trend,
the ltype of inventory that
is favorable by customers.
l’’

Making Dicisions The decision of management Corporate Gorvenance An lapproved documentations

was still implemented
although shareholders’s
interest was not satisfied
may not be followed,
there is no supervision or
approval of Board of
Directors over Board of
Managers. Therefore,
interest of shareholders
may not be protected.
related to any decision should
be complied. In addition, BOD
should take into account the
duties of supervision internal
control lsystems. l’’