Small & Medium Enterprise
y Full time employees not exceeding 150 people y Annual sales turnover not exceeding RM25 million y Small enterprise: y Full time employees 5 > 50 people y Sales turnover RM250,000 > RM 10 million y Medium enterprise: y Full time employees 51>150 people y Sales turnover RM 10 million > RM 25 million

Excel Poultry & Meat
y 1998 y SME y Employees 20 y Currently y Large enterprise y More than 200 employees y Sales turnover 74.9 million

Ceiling price mechanism
Price SS

P0 P1 Shortage Q1 Q0 Q2 Ceiling price DD Quantity

Way to deal the shortage problem
y Import the goods y Shortage can be eliminated y Supply at same price y Quota y Impose quota for each person y First came first serve

y process of social influence in which one person can enlist the aid

and support of others in the accomplishment of a common task. y ultimately about creating a way for people to contribute to making something extraordinary happen. (Alan Keith of Genentech) y the ability to successfully integrate and maximize available resources within the internal and external environment for the attainment of organizational or societal goals. (Ken "SKC" Ogbonnia)

Leadership Styles
Authoritarian ‡ Leaders tell their employees what they want done and how they want it accomplished, without getting the advice of their followers ‡ Appropriate conditions to use it is:  Employer have all the information to solve the problem.  Lacks of time.  Employees are well motivated. Participative ‡ Leader including one or more employees in the decision making process (determining what to do and how to do it). ‡ The leader maintains the final decision making authority. ‡ Appropriate conditions to use it is:  This is normally used when employer have part of the information, and employees have other parts.  Employ knowledgeable and skillful employees.  Using this style is of mutual benefit ² it allows them to become part of the team and allows to make better decisions. Delegation ‡ The leader allows the employees to make the decisions. However, the leader is still responsible for the decisions that are made. ‡ Appropriate conditions to use it is:  Employees are able to analyze the situation and determine what needs to be done and how to do it.  Trust and confidence towards employees

Value and Ethic as leader
y Integrity y Responsibility y Credibility y Independence

y En. Selamat do not have value

y Must have value and ethic

an ethic as leader: Independent.  Director was reluctant to take

when become as leader: Independent.  BOD must straight in their

any actions against Encik Selamat since he is very well connected and had good reputation in the previous company.

decision.  As a leader, he should act with profound sense of integrity and fairness.  Encik Selamat must uphold this value in his daily decisions and actions.

y En Selamat use delegation

y He should monitor or use

style with high trust to En Kassim

combination leadership style.

Organizational Chart

En. Selamat General Manager En. Kassim Finance Manager

Ms. Choy Credit Controller

Pn. Azura Accounts Executive

Duties of Director
y Establish vision, mission and values y Determine the company vision and mission to guide and set plan for its current

operations and future development.
y Set strategy and structure y Review and evaluate present and future opportunities, threats and risks in the external

environment and current and future strengths and weaknesses relating to the company. y Determine the business strategies and plans and ensure that the company's organisational structure are capable and appropriate for implementing the chosen strategies.
y Delegate authority to management y Monitor and evaluate the implementation of policies, strategies and business plans. y Exercise accountability to shareholders and be responsible to relevant

stakeholders y Understand and take into account the interests of shareholders and relevant stakeholders. y Monitor relations with shareholders and relevant stakeholders by gathering and evaluation of appropriate information.

Duties of General Manager
y Primarily responsible for guiding employees in achieving the goals y y y y

y y

of the organization. Ensure that all processes and practices are working in a proper manner. They need to hire well-experienced and efficient managers for handling the operations of individual practices in a company. They need to train, guide, assist and monitor that managers. Conduct presentations to the higher management pertaining to business, marketing, and advertising strategies, and all other necessary aspects of the company processes. Communicating with clients and attracting new projects to the company. Ensure that every individual department is giving their best possible outputs, and recommending any new policies that are likely beneficial to the organization.

Duties of Credit Controller
y Manage the book of debtors accounts y y y

y y y

(to be familiar with all companies the needs are and how to deal with late payments on each of them). Ensure payment of outstanding invoices via email, letters, and telephone Ensure that the company don t exceed the credit limit before give them credit sales. Keep a record of all information and communication with the customer (this is important when there are payment problems and the account becomes legal, these records are needed for court proceedings). They will reconcile accounts and do the same for the month end for the whole debtor ledger. They report to management on outstanding issues and inform them early of potential debtors problems. They may deal with liquidators and ask for bad debts to written off.

A potential conflict exists when there is a possibility that an individual s outside financial interests could directly and significantly affect the individual s professional actions or decisions.

Where can a Conflict of Interest occur?

Business relationships

Individual relationships


Individual relationships
y Example : En. Selamat & En. Azman

Recommendations:1) Research clients, employees, and companies thoroughly before doing business with them. 2) Create and communicate a code of ethics that includes guidance on client and any other relationship of that nature.

Sales & Cash Collection

y Marketing department continued to supply the

product even the credit limit of Cold Gold Sdn Bhd had gone into its limit.

Should perform well in sales activities HOW??????????
(1) Sales Order Entry (4) Cash Revenue (2) Collections Cycle Shipping (3) Billing

Sales Order Entry
orders Customer Rejected Orders (2) Approve Credit Acknowledgement Approve orders (3) Check Inventory Availability (1) Take Order

Process of Sales Order Entry
(1) Taking Customer Orders ‡ Receive order in many ways. ‡ sales order contains information about item numbers, quantities and prices. (2) Credit Approval ‡ Credit sales should be approved before they are processed. ‡ Checking and verify the account. ‡ Order exceeds the customers credit limit, it require specific authorization by credit manager. (3) Checking Inventory Availability ‡ Determine if there is sufficient inventory available to fill the order. ‡ If sufficient, the sales order is completed. ‡If not sufficient, the department of production will be informed about the shortage.

y Weakness in cash collection.

- Because of customers selection. - Depends on relationship rather than business matter.

y Provide sales discount for early payment. y Provide good term of payment. y Should find potential clients which are profitable. - Find new market, export to others countries.

Issue on Cash Collection
y The statement of customer account is not tie up with

the clients records. y Two possibilities:y Account receivable not being maintain properly. y Theft on cash collections.

Maintaining of Account Receivables. y Errors in maintaining customer accounts can lead to the loss of future sales and may indicate possible theft of cash. y Procedure to maintaining the customer accounts:y Validity checks on the customer and invoice numbers. y Closed-loop verification-ensure that proper account is

being credited. y A field check-only numeric values are entered for payments amount.

y It also important to reconcile the subsidiary accounts

receivables with the general but the reconciliation should be done by another person. It is because:y Its easier to catch someone mistake. y Identify irregularities.

Process of Cash Collections
Payments Customer Cash Receipts Cash Collection s Statements Deposits Bank

Objective of Cash Collections Function:- to safeguard customers remitances.

Cash Collections
y Segregation of duties is the most effective control

procedure for reducing theft. y The duties should be segregated:y Handling cash or checks and posting remittances to

customer accounts. y Handling cash or checks and authorizing credit memos. y Issuing credit memos and maintaining customers accounts.

Who is whistle blower?
y person who reveals any wrongdoings or malpractices

that are taking place within an organization

Whistle blower
y significant means of detecting fraud and corruption

and should be part of an overall control framework. y keep things to ourselves or it not being in our nature to do that. y may file complaints that reasonably believes evidences a violation of a law, rule or regulation.

What shows whistle blowing act??
Ms Choy had approached BOD.

For what????
The deal between En. Selamat and one of the Cold Gold Sdn Bhd s directors.

y En. Selamat is the best friend of major customer. y Allow customer to be supplied without concerning on

their outstanding balance. y The BOD refuse to take any action

Business relationships
y Example : BOD & En. Selamat

Recommendations:1) Maintain professionalism in the office y Employers should promote open communication with their employees but not to the extent that the workers treat them as bosom-buddies. While it will be helpful to remain approachable, employers and supervisors should know where to draw the line. y Remember that a sense of authority is the most important thing in managing a business.

Recommendations:- (Continued):2) Make sure to hire people, especially board of directors and key employees, based on their skills and dedication. y When hiring board of directors, make sure they are not part of any rival company or own a business that competes with the firm where they serve as key employees and decisionmaker. 3) Avoid Conflict of Interest y S 132(2) of CA 1965 : shall not make improper use of company information to gain directly or indirectly advantage for himslef

y The company financial result become worse as there

are increase in cost of chicken production
y Find other alternative to feed the chicken ex: y Use chicken shit as their side income

y The company ignore the importance of collection

system that resulted in high outstanding balance. y Most of the decision made by En Selamat had incurred cost to the company.

Conclusion (continued..)
y Use his power to give benefit not only to himself but

other people that well connected to him. y Involve in conflict of interest. y En Selamat mostly responsible on the problem faced by company.

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