I) INTRODUCTION:

Mobile World Investment Corporation is a Vietnamese company operating in the retail business of mobile devices and electronics / home appliances through their two chains: thegioididong.com ( which means mobile world ) and dienmay.com ( which means consumer electronics ). In this paper, I will focus only on thegioididong.com.Thegioididong is now the leading mobile device retailer ( distributing mobile phones, tablets, laptops and accessories) in all 63 cities and provinces of Vietnam through a network of more than 290 stores. Thegioididong opened its first store in 2004, the first kind of a modern mobile phone store in Vietnam where customers could go to experience the products and get superior customer service, which was quite different from other thousands mom-and-pop mobile phone stores back then. Since the first store, Thegioididong has expanded quickly nationwide. As of May 2014, Thegioididong represents around 28% market-share in smart-phones and 30% market-share in tablets sold legally in Vietnam.Thegioididong was also the pioneer in launching the website thegioididong.com, the first mobile phone e-commerce website in Vietnam where customers could go to find detailed mobile products information, check prices and compare products before making any purchase decisions. Thegioididong.com is now one of the most visited websites in Vietnam with more than 10 million visits / month, ranked among the top 5 e-commerce websites in Vietnam.Thanks to its success and customer service quality, Mobile world has been awarded with several international prizes by prestigious organizations, including The Global Growth Enterprise by the World Economic Forum, the Top 5 Fastest Growth Retailer in Asia Pacific 2010 by Euromonitor International, and the Top 500 Retailers in Asia-Pacific by Retail Asia magazine for 4 consecutive years (2010-2013). The company also received numerous local awards, including The Most Trusted Retailer, The Best Mobile Phone Retailer, The Mobile Phone Providing the Best Customer Care Services and SupportsOn 14 July 2014, the companys shares were listed on the Ho Chi Minh City Stock Exchange under the ticker symbol MWG.

II)PROBLEMS: Several potential issues and problems could be occurred in the financial statements and during the reporting process. Possible reason for those problems could be endlessranging from unintentional errors to intentional deception or fraudresulting financial statements sometimes contain errors or omissions that can mislead investors, creditors, and other users. Financial statement problems that might happen to the company, in general, are classified into three categories1.Error: This category result when unintentional mistakes are made in recording transactions, posting transactions, summarizing accounts, and so forth. Errors are not intentional and when detected should be immediately corrected. Errors can result from sloppy accounting, bad assumptions, misinformation, miscalculations, and other factors. The following problems may occur to the company:-Error in Transactions and Journal Entries: an incorrect figure is entered in the records and then posted to the correct account. Example: Cash $1,000 for plant repairs is entered as $100; plant repairs account is debited with $100.-Error in Transactions and Journal Entries: Failure to prepare certain receiving reports. Personnel at individual stores failed to prepare receiving reports for shipments of goods directly from wholesalers. This significant deficiency increases the chance that the company will pay for merchandise that has not been received.- Errors in Accounts and Ledgers: Capitalization of certain repairs and maintenance expense items. A material amount of certain of these expense items may be improperly recorded into the property and plant asset accounts. The companys controls related both to the original recording and to the review of that recording may be ineffective in preventing or detecting the misstatements.

2.Frauds: This category result from intentional errors. Fraudulent financial reporting occurs when management chooses to intentionally manipulate the financial statements to serve their own purposes Employee fraud, or fraud by nonmanagement employees, is generally designed to directly convert cash or other assets to the employees personal benefit. Typically, the employee circumvents the companys internal control system for personal gain. Management fraud is more insidious than employee fraud because it often escapes detection until the organization has suffered irreparable damage or loss. Usually management fraud does not involve the direct theft of assets. Top management may engage infraudulent activities to drive up the market price of the companys stock to create an illusion that an entity is healthier and more prosperous than, in fact, it is. This may be done to meet investor expectations or to take advantage of stock options that have been loaded into the managers compensation package. If the fraud involves misappropriation of assets, it frequently is shrouded in a maze of complex business transactions, often involving related third parties. The following frauds may occur to the company:

Employee Theft: When a single individual or department has responsibility for both asset custodyand record keeping, the potential for fraud exists. Assets can be stolen or lost and the accounting records falsified to hide the event. Lets assume our company operates a large storeroom containing thousands of goods ready for shipment. Detailed perpetual inventory records were maintained by the employee in charge of the storeroom. A shortage of several products developed as a result of theft by another employee who had acquired an unauthorized key to the storeroom. The employee responsible for the storeroom discovered the discrepancy between the products in stock and the quantities of clubs as shown by the records. Fearing criticism of his recordkeeping, he changed the inventory records to agree with the quantities on hand. The thefts continued, and large losses were sustained before the shortages were discovered. If the inventory records had been maintained by someone not responsible for physical custody of the merchandise, there would have been no incentive to conceal a shortage by falsifying the records.

Lapping: Lapping involves the use of customer checks, received in payment of their accounts, to conceal cash previously stolen by an employee. For example, one employee first steals and cashes Customer As check for $500. To conceal the accounting imbalance caused by the loss of the asset, Customer As account is not credited. Later (the next billing period), the employee uses a $500 check received from Customer B and applies this to Customer As account. Funds received in the next period from Customer C are then applied to the account of Customer B, and so on. Employees involved in this sort of fraud often rationalize that they are simply borrowing the cash and plan to repay it at some future date. This kind of accounting cover-up must continue indefinitely or until the employee returns the funds. Transaction Fraud that involves deleting, altering, or adding false transactionsto divert assets to the perpetrator. A common type of transaction fraud involves the distribution of fraudulent paychecks to nonexistent employees. For example, a supervisor of our company keeps an employee who has left the organization on the payroll. Each week, the supervisor continues to submit time cards to the payroll department just as if the employee were still working. Lets assume the supervisor is responsible for distributing paychecks to employees. The supervisor may then forge the former employees signature on the check and cash it. Although our company has lost cash, the fraud can go undetected because the credit to the cash account is offset by a debit to payroll expense. Kickback Fraud: The kickback is a form of fraud associated with purchasing. Our company expects the purchasing agents to select the vendor that provides the best products at the lowest price. However, to influence the purchasing agent in his or her decision, vendors may grant the agent financial favors (cash, presents, football tickets, and so on). This activity can result in orders being placed with vendors that supply inferior products or charge excessive prices.

3.Disagreement: This category result when different people arrive at different conclusions based on the same set of facts. Because accounting involves judgment and estimates, opportunities for honest disagreements in judgment abound. These disagreements often come about because of the different incentives that motivate those involved with producing the financial statements. An example of a disagreement might be differing views about what percentage of reported receivables will be collected or how long equipment and other assets will last.III)SOLUTIONS: The company has the following those policies and procedures, in addition to the control environment and accounting system that management has adopted to provide reasonable assurance that the companys established objectives will be met and that financial reports are accurate.1.Adequate Segregation of Duties: the company makes sure that no one department or person should handle all aspects of a transaction from beginning to end. No one individual should perform more than one of the functions of authorizing transactions, recording transactions, and maintaining custody over assets. The goal is to not allow an individual to have incompatible duties that would allow him or her to both perpetrate and conceal errors or fraud in the normal course of his or her duties. - the authorization for a transaction is separate from the processing of the transaction. For example, the purchasing department are not allowed initiate purchases until the inventory control department givesauthorization. This separation of tasks is a control to prevent individuals from purchasing unnecessary inventory. Responsibility for the custody of assets are separated from the recordkeeping responsibility. For example, the department that has physical custody of finished goods inventory (the warehouse) are not allowed to keep the official inventory records. A credit sales transaction may be used to illustrate appropriate authorization and segregationprocedures. Top management may have generally authorized the sale of merchandise at specified credit terms to customers who meet certain requirements. The credit department may approve the sales transactions by ascertaining that the extension of credit and terms of sale is in compliance with company policies. Once the sale is approved, the shipping department executes the transaction by obtaining custody of the merchandise from the inventory stores department and shipping it to the customer. The accounting department uses copies of the documentation created by the sales, credit, and shipping departments as a basis for recording the transaction and billing the customer. With this segregation of duties, no one department or individual can initiate and execute an unauthorized transaction.2.Proper Procedures for Authorization: Our company has established proper authorization for every transaction. While the board of directors and upper-level management possess a fairly general power of authorization, a clerk has limited authority. The board would authorize important issues like dividends, a general change in policies like to extend a particular customers credit limit beyond the normal amount; a clerk is restricted to authorizing credit or a specific cash transaction. Only certain people are authorized to enter data into accounting records and prepare accounting reports. 3.Physical Control Over Assets and Records: The purpose of access controls is to ensure that only authorized personnel have access to the firms assets. Unauthorized access exposes assets to misappropriation, damage, and theft. Therefore, access controls play an important role in safeguardingassets. We have physical security devices, such as locks,safes, fences, and electronic and infrared alarm systems to control against direct access. Improper indirect access to assets, generally accomplished by falsifying financial records, are also paid attention to by our company. We have activities that safeguard financial records such as maintaining control at all times over unissued prenumbered documents, as well as other journals and ledgers, and restricting access to computer programs and data files.Only authorized individuals are allowed access to the companys valuable assets. We also make periodic comparisons should be made between accounting records and the physical assets onhand to make sure waste, loss, or theft of the related assets may go undetected.4.Adequate Documents and Records: we have established a document retention policy to make sure that corporate information should be available and easily accessible, when required.All the accounting records of the company are sufficiently recorded, making them easily traceable from the financial statements to the ledger accounts, to the journals, to the source documents, and back to their original source.5.Independent Check on Performance: the company applies verification procedures to independently checks the accounting system to identify errors and misrepresentations. Verification takes place by an individual who is not directly involved with the transaction or task being verified. Through independent verification procedures, the company management can assess the performanceof individuals, the integrity of the transaction processing system, and the correctness of data contained in accounting records. Examples of independent verifications include: Comparing physical assets with accounting records, Reconciling subsidiary accounts with control accounts, reconciling the bank statement, reviewing management reports (both computer and manually generated) that summarizebusiness activityThe company also periodically rotates employees into different jobs and forces them to take scheduled vacations.

IV)CONCLUSION