b) The weakness in the selected cycle.

1.Theft of cash- cash collection clerk reconciles bank statement and has initial access to cash
receipts

2. Theft of inventory- physical counts of inventory are not made at least annually

3. Data loss- sales clerk, branch clerk and other staff are exposed to every single transaction
in the company

4. Customer order are incomplete and inaccurate- customer needs to fill in the form wrongly
stating the goods wanted or the quantity required as customers place their orders in order to
buy in large quantity

5. Billing errors- branch clerk keys in the transaction of the day, he or she tend to have
pricing mistakes

c) one risk exposure from the internal control weakness.

Risk exposure is the threat to a firm’s assets and information quality due to lapses or
inadequacies in controls. Managers who have access to records and financial reports often
have authority to approve transactions. The risk of having theft of inventory will be having
many errors not being detected as inventory listing is only done once a year. This will cause
much more errors to be accumulated and cause harm to the company. Failing to record the
inventory in time will also cause theft of inventory as the inventory movement are not easily
traced, unethical staff will bring back goods belong to the company

d) Suggest and briefly explain one internal control procedure associated with of the weakness

1. Theft of cash- The company should segregate their duties which is the person who receive
the instalment and preparing the bank reconciliation should be different

2. Theft of inventory- Physical count of inventory should be made at least once a year and
inventory records should be corrected and investigated. The company should implement the
effective safeguard in other to protect the inventory from theft.

3. Data loss- Loss of data does happen in the company if the branch clerk or staffs reveal
information about the goods in the shop to other competitors. The manager should control the
all staff from doing so by setting rules and regulation.

4. Customer order are incomplete and inaccurate- Internal control take place when customers
order in bulk, the person in charge should take precaution of the orders taken. When the
customers do so, the specific thing ordered must be the correct goods wanted

5. Billing errors- Human typing error do occurs when it comes to the pricing or any data.
Appoint a staff that is reliable to constantly check whether the goods are at correct pricing.
Problem.

1.We take long time to choose the right company that we wanted to survey

2.We called few companies in Changloon but we could not get a good response from them

3.Since all the group members were busy with all other assignments, we had problem to
make a discussion

4.Problem that we face is the company didn't provide the complete information that we
required to do the assignment.

Conclusion
The manager of Chin Hin Sdn.Bhd is very kind, polite and give cooperation to us when we
do the interview section. The survey on Chin Hin Sdn. Bhd gave our group members a
chance to understand more about the data flow diagrams and internal controls of company.
Through this assignment we did the background of the company, project’s objective,
prepared table of entities and activities, context diagram, a physical data flow diagram and
systems flowchart of the cycle. We also able to explained five weaknesses in the cycle and
described one risk and exposure from the internal control weaknesses. All in all this
assignment on Chin Hin (Jitra) Sdn Bhd company provide us good knowledge on how the
company works on daily and what are the activities involved in each department. We would
like to thank Dr Hafizah Mohamad Hsbollah for guiding us well and support us throughout
the completion of this assignment.