Task 1

CHAPTER 2: PROBLEM 8 SYSTEM FLOWCHART A clerk in the human resource department receives time sheets for employees from production department. The time sheets are giving information about employees details and employees attendance. The clerk enters the data into a computer terminal that is attached to a computer program in the computer operations department. A computer program received data and stores it as payroll data in storage devices. A computer program edits the transaction from payroll data, employee master file and cost centre master file. The computer program editing the details of new employees and those quit from the organization. The program also edits the current wage rate for the employees. For the employees details which are incomplete and wrongly recorded in the system, the computer program will stored it into storage device. The computer program will enter the corrections and stored it in storage device as edited transactions. The edited transactions file is the processed by an updated program that posts the transactions to the employee master file and cost centre master file. The updated data will store into edited transactions storage. Finally, the update program produces two information of payroll. One is pay checks and another one is reports. The clerk will send the pay checks to employees and the report will be sent to accounting department and other related departments.

CHAPTER 3: PROBLEM 3 CASE: WHODUNIT a) Fraud schemes that used in this situation were asset appropriation. Assets can be misappropriated either directly and indirectly for the perpetrators benefit. Transactions involving cash, checking accounts, inventory, supplies, equipment, and information are the most vulnerable to abuse. In this case, Sarat Sethi directly involved stealing $100,000 for his own benefit. There are the examples of fraud schemes which are lapping. Lapping involves the use of customer checks, received in payments of their accounts to conceal cash previously stolen by an employee .Lapping is usually detected when the employee leaves the organization or become sick and must take time off work. Based on this situation, Sethi intend to steal cash and escape from the organization. A month is consider a short period for the management to get know about the fraud. Usually, all payments should be paid within a month. If the organization did not receive any payments from customers, they will try to contact the customers for the payments. There will be a problem if the customers said the payments already made. The company will notice that a fraud was happened and Sethi can be caught. This is a reason why Sethi leave the organization after a month.

b) Based on SAS 78/COSO Internal Control Framework, control activities are the policies and the procedures used to ensure that appropriate actions are taken to deal with the organizations identified risks. There are the controls that Benson & Abernathy should use to prevent the case happening again.

1. IT Controls IT controls related specifically to the computer environment. It divided into two groups which is general control and application controls. We suggest that Benson & Abernathy should change their manual system into computerized system. Application controls is more suitable for Benson & Abernathy. Application controls ensure that integrity of specific system. Example: Benson & Abernathy should use a specific system such as an accounting system to control their account receivable.

2. Physical Controls This class of control relates primarily to the human activities employed in accounting system. These activities maybe purely manual or they may involve the physical used of computer to record transaction or update account. We would like to suggest Benson & Abernathy to install or provide camera system in the organization.

3. Segregation of Duties One of the most important control activities is the segregation at employees duties to minimized incompatible functions. Benson & Abernathy should rotating employees into different jobs and forcing them to take scheduled vacations.

4. Supervision Implementing adequate segregation of duties requires that a firm employee a sufficiently large number of employees. Benson & Abernathy appoint another supervisor which can help the existing supervisor to separated tasks to employees.

CHAPTER 4: PROBLEM 2 A & V Safety Inc. Question c

1. Authorization Transaction authorization in real-time processing systems is an automated task. In POS systems, the authorization process involves validating credit card charges and establishing that the customer is the valid user of the card. After receiving online approval from the credit card company, the clerk should match the customers signature on the sales voucher with the one on the credit card. The weakness of the situation, the sales clerk complete purchase order and at the same time the sales clerk performs a credit check and either authorizes or reject the order. The sales clerk did not match the signature on sales voucher with the one on the checks.

2. Segregation of duties In this case, only one manager handles checks and remittance advice. This is considering as a weakness because according segregation of duties to be controlled. The organization should be structured so that a successful fraud requires collusion between two or more individuals with incompatible responsibilities.

3. Supervision Based on the case, the another weakness is 200 full time employees who work out of its headquarters in San Diego, California without any supervisor. Implementing adequate segregation of duties requires that a firm employ a sufficiently large number of employees.

Task 2 Introduction to business Our business is about footwear industry named AAA Bhd which located at Pasir Gudang, Johor. It is established on 2011 and we are running the business used click-and-mortar or in other word is electronic business. Electronic business, commonly referred to as "e-business", or an internet business, may be defined as the application of information and communication technologies in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of the essential activities of any business. Electronic commerce focuses on the use of ICT to enable the external activities and relationships of the business with individuals, groups and other businesses. Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers. Basically, electronic commerce (EC) is the process of buying, transferring, or exchanging products, services, and or information via computer networks, including the internet. EC can also be beneficial from many perspectives including business process, service, learning, collaborative, community. EC is often confused with e-business. Three type of e-business that widely used are business-to-business (B2B), business-to-consumer (B2C), and consumer-to-consumer (C2C).

Business processes

A business is a collection of activities designed to produce a specific output for a particular customer or market. It implies a strong emphasis on how the work is done within an organization, in contrast to a products focus on what. A process is thus a specific ordering of work activities across time and place, with a beginning, an end, and clearly defined inputs and outputs (a structure for action).

The e-Business model, like any business model, describes how a company functions; how it provides a product or service, how it generates revenue, and how it will create and adapt to new markets and technologies. It has four traditional components. These are the e-business concept, value proposition, sources of revenue, and the required activities, resources, and

capabilities. In a successful business, all of its business model components work together in a cooperative and supportive fashion.

Goal A business process has some well defined goal. This is the reason the organization does this work, and should be defined in terms of the benefits this process has for the organization as a whole and in satisfying the business needs. Our business goals are: 1. To market trendy, elegant shoes, ranging from sizes 5-13, that will cater to the needs of the everyday woman. 2. To receive a 50% profit margin within the first year. 3. To provide customer service, measured through new and repeat business (our goal is that 50% of our customers will return within 6 months for an additional purchase) and multiple sales (our goal is that 30% of our non-running and 60% of our running shoe sales are accompanied by an additional purchase). 4. To achieve a net profit of $5,000 by year two and $30,000 by year five. Mission Our businesss mission is to offer quality, name brand shoes and accessories in an assortment of sizes and styles to accommodate the chic in every woman. Development and cultivation of best available human resources within the country by imparting knowledge and skills by conducting appropriate courses. In developing and provision appropriate infrastructure for attainment of international standards. Vision Our business shall take necessary steps for creating quality infrastructure for design, development, production and support service system for the Malaysian industry. Our efforts would be in the direction, which makes this Institute the world leader in the field of fashion, design, technology & retail management due to the quality of our products & services, response and cost effectiveness.

Outputs A business process will typically produce one or more outputs of value to the business, either for internal use of to satisfy external requirements. An output may be a physical object (such as a report or invoice), a transformation of raw resources into a new arrangement (a daily schedule or roster) or an overall business result such as completing a customer order. An output of one business process may feed into another process, either as a requested item or a trigger to initiate new activities. Resources A resource is an input to a business process, and, unlike information, is typically consumed during the processing. For example, as each daily train service is run and actual recorded, the service resource is used up as far as the process of recording actual train times is concerned. It depends on the shoes. A lot of them today are made of plastic, which comes from some recycled plastics and petroleum products. Sneakers are primarily plastic, with canvas fabric made of cotton. Leather shoes are of course made from the hides of animals, and this takes tanning chemicals to cure the hides. Heels may be made of wood, which takes trees. Some shoes are made of rattan, which is a grass. Since they are often handmade they may be the most ecofriendly of all, but they're not really a viable alternative outside of the tropics. Barefoot Tess Great Selection of Unique Shoes With shoes from the likes of Jeffrey Campbell, LuLu Guinness and Via Spiga, Barefoot Tess is a carrying size up to U.S. 13; this site has an incredibly large selection of incredibly hip shoes. Instead of just offering what is already available in larger sizes, Barefoot Tess has cute shoes manufactured just for them. This site is a must stop for women who wear large sizes and want pretty shoes and boots. Cinderella Shoes Large Size Women's Shoes from Ireland Cinderella Shoes is an Ireland-based shoe retailer, specializing in large size women's shoes. Though the selection is not quite as large as some of the other retailers on the list, they carry a nice selection of larger sized women's shoes, and have size and price conversions built right into the page.

Dream Shoes Fabulous Shoes in Sizes 10-15 With lots of casual and dress shoes to choose from, women who wear a larger shoe size will love this site. I'm particularly impressed with their selection of dress shoes, which includes some very pretty styles from brands like Magdesians, Pelle Moda, and Moda Spana.

Footwear Technology To further drive growth, Malaysias footwear industry must evolve from traditional methods to modern shoemaking manufacturing, utilising advanced technology. Selangor Human Resource Development Centre (SHRDC) works closely with the government to assist the industry in their modernisation and technological integration. Our business would like to join or participant in SHRDC. SHRDCs participants experience the entire footwear manufacturing process from design and testing to prototyping and manufacturing the end product. They will also learn advanced 3D designing skills in a CAD/CAM environment and how to flatten these designs into 2D forms for pattern engineering and grading. AAA Sdn Bhd will be able to utilize 3D cutters in SHRDC to obtain hands-on understanding and skills in shoe prototyping and manufacturing.

SHRDC enables participants to tap their creativity and innovation whilst ensuring the end product meets performance, technical and comfort factors. They learn the importance of footwear design and product development strategies. We will also develop their awareness and understanding of fashion trends in terms predicting style, colour and range thereby enabling them to be competitive in the industry. SHRDC provide us with exposure to international expertise by inviting international designers, machinists and specialists to SHRDC from time to time. To make it more affordable and accessible, SHRDCs facilities and courses are also eligible for subsidies from the Malaysian government. This ensures that all shoemaking concerns (including the cottage industries) are able to maintain competitiveness and grow with the industry.

CAD/CAM in the footwear industry is the use of computers and graphics software for designing and grading of shoe upper patterns and, for manufacturing of cutting dies, shoe lasts and sole moulds. CAD/CAM software is a PC-based system, which is made up of program modules. Today, there are 2D and 3D versions of CAD/CAM systems in the shoe industry. Initially it was used primarily for pattern grading. It enabled manufacturers to perform complex grading relatively easily and quickly. CAD systems today have been developed with a much wider range of functions. Logos, textures and other decorations can be incorporated into product designs of both the uppers and soles to help reinforce branding on all areas of the model. It automates routine procedures, increasing speed and consistency whilst reducing the possibility of mistakes. CAD data can now be used effectively for a wide variety of activities across footwear manufacturing business. CAD/CAM generates data at the design stage, which can be used right through the planning and manufacturing stages. Latest improvements in the CAD/CAM technology are:

Graphic capabilities and interconnectivity have improved enormously, Software developments have progressively made systems more intuitive and easier to use,

With 2D sketch and paint modules, a serviceable sketch can be produced and then color and texture can be added.

3D systems enable the last and design to be viewed from any perspective and several angles even simultaneously.

With CAD/CAM software, footwear manufacturers can cut their time to market dramatically and so increase market share and profitability. In addition, the power and flexibility of the software can overcome restrictions to the designers creativity imposed by traditional methods.

Footwear Infrastructures Freedom of Association We are updating our companys Code and the Code of Leadership Standards to make clearer the responsibility of contracted factories to respect their employees' right to freedom of association and collective bargaining to the extent permitted by local law. This includes the right to form and join trade unions and other worker organizations of their own choosing without harassment, intimidation, interference or retaliation. Where national law restricts freedom of association, the contracted factories are required to facilitate alternate means to individually and collectively engage with their employees and for employees to express their grievances and protect their rights regarding working conditions and terms of employment. The updated requirements will also address the obligation to comply with any local laws providing special protection to employees or worker representatives engaged in union activities, a prohibition on disciplining employees having engaged in legal strikes, the duty to bargain in good faith and honoring the terms of any negotiated collective bargaining agreement. Responsible transitions We are updating our companys Code and the Code of Leadership Standards to include worker protections in the event of factory closure or retrenchment. These steps include standards for factories that include, at a minimum, notice, consultation, severance and collective bargaining. Contracted manufacturers are also required to make payment to workers of retirement or severance funds, in compliance with local law. This requirement includes contracted manufacturers facilitating payments of social security provisions to which the employee may be entitled, such as unemployment insurance, and accurate record keeping on payment into and maintenance of funds to ensure workers are protected.

In addition, contracted manufacturers are encouraged to go beyond what is required by law or collective bargaining to provide outplacement or retraining assistance, additional financial support, medical benefits and assistance in obtaining government benefits. The contractor is encouraged to provide these either directly or in coordination with governments, NGOs or third parties. Developing or Enabling Competitive Supply Chains. NIKE, Inc. recognizes the need for a well-coordinated and efficient supply chain for its business and the industry. Because the supply chain spans multiple jurisdictions from raw materials to production to shipping to retail and, ultimately, to consumers, a consistent and mature public policy position is needed. We support policies that deliver efficient, cost-effective delivery of NIKE, Inc. products in a responsible manner. Our efforts concentrate on ensuring efficient transport, security and safety of NIKE, Inc. products throughout the supply chain. In addition, we advocate for policies that help to ensure that NIKE, Inc.'s supply chain - from factory to consumer operates in a manner that considers both people and the environment at each step of the way. We work with a number of bodies to advocate for these policies. These include national governments, industry associations and NGOs. Infrastructure in Vietnam. Nike has played a leadership role, along with other businesses and multilateral development organizations, in supporting infrastructure development in Vietnam. Nike created and led a public-private partnership that offered an Infrastructure Exchange Program for Vietnamese government officials. The first component of the program involved having key Vietnamese government officials visit a Nike footwear factory in Vietnam and subsequently physically follow the movement of finished products from the factory to the port. The group traveled to southern China, an area well known for its development of physical infrastructure. They also visited Singapore to see world-class port facilities and operations and learn about infrastructure planning and financing. Each component included presentations and dialogue with experts in various fields.

We believe improved infrastructure, specifically roads and ports, will lead to additional investment and job creation in Vietnam, thereby improving economic opportunities and the standard of living. Improved roads and related infrastructure lead to more efficient transport of goods, contribute to a decrease in traffic congestion, and reduce emissions and related pollution. These improvements benefit businesses, including Nike, that contribute to job creation and economic development. This model of cooperation is an example of how the private sector can work with other key stakeholders on important development issues and opportunities.

Challenges Competitive capacity of footwear enterprises is at low level. Therefore they have to face a lot of difficulties with stronger competitors from the region and China. The main reason could be understood as lacking resources of raw materials and low price of products from other competition countries. Staffs for shoe designing and product development are also limited. Companies dont have enough talented and skilled staff for its production management as well as to develop the potential markets. Advantage of Vietnam regarding labor forces still is factor of competition, but there are some difficulties and have big changes. Training labor forces and skilful workers are not meeting requirement of demand of production. Numbers of enterprises have small capacity, not active with changing of the markets, they must receive processing contracts via third partners, so effective of production is very limited, production faces with difficulties because of without potential customers. Numbers of enterprises in the industry still not ready and prepare for integration process Pressure with non trade and technical barriers (Technical barriers, Protection policy from potential footwear import countries, CSRrequirement, Good working place and environment requirements. The shoe manufacturing industry in Malaysia mainly comprises of small-scale and familyowned concerns. According to industry sources, there are 966 footwear manufacturers, employing about 30,000 workers, with total capacity of 70 million pairs. The total industry turnover is estimated to be RM 825 million annually.

Malaysian manufacturers face strong competition from low-priced shoes from China. As shoe production requires relatively high labour inputs, manufacturers have undertaken measures which include importing semi-finished parts such as shoe uppers, which form the major component of footwear, and sub-contracting the production of such parts to neighbouring countries, where labour is abundant, to maintain cost competitiveness. Manufacturers should not be too concerned about competition from the low-priced products as greater opportunity lies in the high-end products. To succeed in this market, manufacturers should place premium consideration on quality. Good fit, market relevant design, high standards of craftsmanship and quality raw materials are the essence of quality of footwear. As customers are more discerning and specific in their demands, shoe manufacturing becomes more challenging. Shoes are not just seen as fashion items but also solutions to specific health or medical problems. Therefore, manufacturers must be willing to invest in the necessary technology in order to meet the changing expectations of a more segmented market. The fashion trend in the footwear industry is closely related to design innovation, which involves both product and process development. It is through these product improvement efforts that manufacturers are able to come out with new innovations thus improving the three key factors in footwear design:

comfort style; and durability