Management_Account_Fraud_Case_Nexwin.pptx

Financial misrepresentation case _ Nexwim

1. Management Account – Fraud Indicators Nexwin Electronics Sdn. Bhd. Period: 1 Jan 2025 – 31 Mar 2025

2. 1. Income Statement Summary • Revenue: RM18.5M (↑23%) • COGS: RM11.8M (↑24%) • Other Income: RM500K (↑233%) • Net Profit Before Tax: RM5.1M (↑32%)

3. 2. Key Financial Highlights • RM2.2M revenue recorded on 30–31 March • RM1.5M adjusting entries to prepayments • RM350K 'Strategic Consulting Fee' with no contract • Related party transactions increased • Internal audit delay • Finance Manager resignation

4. 3. Circumstances Suggesting Fraud Risk • Late revenue entries → Revenue manipulation • Adjustments without support → Management override • Unusual other income → Fictitious revenue • Related party transactions → Misappropriation • Audit delay, staff turnover → Weak control

5. 4. Conclusion & Recommended Actions • Risk: Material misstatements from fraud • Focus areas: Revenue recognition, control override • Actions: - Substantive testing - Third-party confirmations - Related party review - Interview outgoing staff - Escalate to Audit Committee