Hp Seg Case Study

Part III
The audit risk identified and audit strategy planned is based on one of the subsidiaries of Hup Seng Industries Berhad, Hup Seng Perusahaan Makanan (M) Sdn. Bhd.. Hup Seng is a company that produces various products, such as cream cracker, biscuits, cookies, and beverage mix. Hup Seng Perusahaan Makanan (M) Sdn. Bhd.is a company that consists of five basic business units which are production, purchasing, sales, human resource and accounting & finance. These departments serve as the fundamental units to manage, organize and support the activities of Hup Seng.
Sales department
The sales department is responsible for the sales and distribution of the products that Hup Seng produces to a different area in Malaysia. This department also

Hup Seng responsible for manufacturing the products from raw materials into finished goods. The finish goods which are output require transfer to inventory. The function of this department is to plan and prepare the schedule of production, control and monitor the workers, supervise procedures of the production. It is to ensure the production can complete on time that plan in the schedule and the quality of the product meet the right quality to satisfy the needs of customers. Furthermore, controlling and monitoring workers, is to ensure that the number of workers can support the activities in production line from time to time and workers are running in the right process. Production department also decides the most excellent and effective ways to manage the department to operate smoothly and effectively.
Control risks Audit approaches
The product’s schedule that plan by the manager may not follow by workers. The auditor can review the plan that they plan to check the whether the workers have followed the plan. We perform this action is to check for the completeness and occurrence.
The availability of raw material may insufficient for the production. The auditor should check the storage of raw materials and finished goods whether it is recorded. The auditor should physically count the stock same as the amount in the

This department provides raw material to the production department. The function of this department is to purchase goods and services for the whole company, not only for production department. There are some examples of goods that are not for production department includes furniture, computer equipment, and office equipment and more. The main responsibility of purchasing department is to ensure that stocks or goods arrive on schedule and it is in good condition as well as quality. Moreover, the department considers the quality rather than price, as long as it is durable and reliability. Hup Seng’s raw material cost is on first in first out