Summary of Flat Cargo Bhd

ACC 4291 – Integrated Case Study

Case Analysis Report on Flat Cargo Berhad: An Auditor’s Conundrum

Normadihah bt Mat Radzi 0924794

Nur Izzah bt Shiro 0924378

Saudah bt Razali 0922762

The summary

Flat Cargo Berhad (FCB) was one of the largest air freight companies in Malaysia. The company was started its operation in 1997 and has been listed in Bursa Malaysia on 2001. The head office was located in Selangor. It was registered as an investment holding company with several subsidiaries which are FC Spare Sdn Bhd, Cargo Management Sdn Bhd, FCB (SPV) Ltd, Cargo Air Service Sdn Bhd, FC Air Ltd. FCB was operating primarily as an air cargo carrier, provide air freight transportation, aircraft charter and leasing. The principal activities of its subsidiaries are air freight services and aircraft ground handling services. FCB has appointed Kencana & Associate as their external auditor. Bangor Berhad was one of the international family conglomerates owned by the Miri Group which has been a major shareholder of FCB in 1997. FCB was ranked 4th in 2005 in terms of capital gains and dividends to shareholder. There is very high increase in the share price from 2001 to 2005 which is RM1.89 to RM10.60 respectively. FCB was aimed to maintain their niche position not only in the Asia Pacific region but also in China, Thailand and India by delivering best quality customer service and satisfying customer demands. Among of its customers are Worldwide Express, United Parcel Services (UPS), Nationwide Express, Citylink, Bax Global, Nippon Express, Cargo Malaysia Services and Bangor Berhad.

The protagonist

The protagonist or decision maker for this case is Mr Chuah Mun Soong. He is an auditor from Kencana & Associates which responsible to make a financial audit for Flat Cargo Berhad (FCB). He needs to present the financial report of Flat Cargo Berhad to the audit committee of FCB in two...