Rationale report group2ac alibaba english centre

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HANOI UNIVERSITY FACULTY OF MANAGEMENT AND TOURISM

-o0o -

CAPSTONE PROJECT 2022

EXPENSE MANAGEMENT AT ALIBABA ENGLISH CENTRE

Rationale report_Group 2AC

Mentor: Mrs Do Van Anh

Dang Thi Khanh Linh 1804010056

_May 23 rd , 2022_

Table of Contents

Abstract 4

1.Introduction 5

2.Company introduction 5

a Brief history 5

b, Vision and Mission 6

c, Organisational structure 6

3 Problem Statement 7

4 Literature review 8

4.1 Expense management in small and medium-sized businesses 8

4.2 Expense management for English-teaching centres in Vietnam 9

4.3 Recording expenses under VAS standard 10

4.4 Administrative expenses 10

4.5 Salary expense management 10

4.6 Commission expense management 13

5 Method of inquiry 13

5.1 Interview question designs 13

5.2 Data collection 15

5.2.1 Lecturer and teaching assistant responses 15

5.2.2 Response of company’s management team 17

5.2.3 Response of CEO 17

6 Results of the projects 18

7 Action plans 22

7.1 Hiring an accountant 22

7.2 Building up Accounting Department 23

7.2.1 Mission and function 23

7.2.2 Plans for recruitment of Accounting Department 24

7.3 Administrative expenses 24

7.3.1 Photocopy expenses 24

7.3.2 Policy on expenses incurred in the course 25

7.4 Salary expenses 26

7.4.1 Fingerprint or card time attendance 26

7.4.2 MISA (ASO) 26

7.5 Commission expenses 29

8 Conclusion 31

REFERENCES 32

APPENDIXES 33

INTERVIEW QUESTIONS 38

Abstract

Through 7 years of operation (2015-2022), Alibaba English Center has achieved

remarkable and rapid growth in the number of students over 40,000 One of the top

concerns of businesses is cost control Expense management is a critical factor

since it also drives the company’s performance, particularly in SMEs and in

periods of difficulty, specifically two years of Covid-19 Alibaba English Center is

a medium-sized company, so the center also exposes to common problems of weak

cost management For this reason, to support the company strengthen its brand,

stay competitive in the market, and maintain strong performance, cost management

is now a top priority for the center's management This project aims to improve the

cost management system at one of the famous English Centers in Vietnam, which

is Alibaba English Center Cost issues, the impact of costs on the organization's

goals will be shown in the project This project aims to assist the company in

solving cost-related issues, namely administrative costs, commission costs and

salary costs Data are collected from the company to identify the problem existing

in cost management system through interviews with managers and staff, direct

observations of the process, and review relevant documentation Despite the

difficulties of mutual trust between the team members and the CEO of Alibaba

company, we expect to develop certain convenient tools and procedures to assist

the management in controlling costs Thereby, we have come up with action plans

such as using more MISA accounting software, using timekeepers, setting up an

accounting department and having specific policies

1.Introduction

General and administrative expenses are expenses incurred in the process of organizing business activities that such enterprises have to spend to operate their business Enterprise administration costs are related to all activities of the enterprise, not separate for each specific activity At the same time, depending on how the business operates, the administrative costs also vary Consequently, what most directors are keen on is the means by which to deal with this expense in the most sensible manner for their business

Enterprise management is a job that requires administrators to understand the organizational structure and standardize the management process as well as optimize the cost of effective enterprise management to bring greater profits In order to maximize profits, each business must maximize revenue and minimize costs For many businesses, administrative expenses account for a small proportion One of the important keys to help businesses manage business costs effectively is to determine business management norms

This is the basis to help businesses make operating estimates because in order to make a labour cost estimate, there must be a norm of man hours, and the cost of raw materials must have

a norm of raw materials In addition, it also helps managers control business activities of the enterprise because normative costs are the standard, the basis for evaluation, and contribute to timely information for managers to make daily decisions such as pricing a product, accepting or rejecting an order, analyzing profitability More specifically, it attaches the responsibility of each employee to the economical use of resources

Good corporate cost management will help businesses operate effectively, optimize unnecessary costs, and control the finances of the business

Up to the present time, the company is facing difficulties in managing cost sources including: salary costs, administrative costs and bonus expenses

Therefore, our solution for the company is to immediately hire an employee to record expenses incurred at the present time, in the next 1 month, set up complete accounting department The company should buy a printer to serve the necessary documents for the teaching process In addition, timekeepers should be installed at 4 locations In particular, the company must issue policies on commission costs, administrative costs and salary policies

2.Company introduction

a Brief history

Alibaba English - the company that we conduct research in is a limited liability company with its headquarter at 186 Giai Phong, Hanoi, founded by Mr Ngo Xuan Thang The company was established in August 2015 with a development path of nearly 7 years so far After 2 years of operation, up to 2017, Alibaba reached the top 100 typical young businesses in Vietnam Up to now, Alibaba has become the largest English centre in Hanoi with more than 40,000 students and

it is also a language centre that has the cheapest tuition fee in Hanoi After 6 years of establishment,

the company has now expanded to 7 facilities with 4 facilities in Hanoi, 2 facilities in Nghe An and 1 facility in Saigon The focus that our team wants to study is on facilities in Hanoi The training system at the company includes pronunciation, grammar, communication and TOEIC In addition to training knowledge about industry transfer, the centre also integrates teaching students about critical thinking, creative thinking, presentation skills and teamwork, more specifically and also the brightest point Alibaba's is a dynamic environment that is different from other English centres

b, Vision and Mission

Since the company's establishment, the company has brought with it the desire of the founder of the company to bring English into the universal language for Vietnamese people in the current economic context of economic integration and globalisation, with the mission of helping one million students to speak English as their mother tongue Moreover, Alibaba also has a mission

to build a strong English community and constantly strives to combine with leading partners in the field to create opportunities and a better future for Vietnamese people

c, Organisational structure

In order for the company to operate flexibly, the organizational structure plays a very important role Alibaba has a team of extremely young, dynamic and enthusiastic employees, the whole company up to now has about 150 employees Organizational structure of one member limited liability company Mr Ngo Xuan Thang is the owner and director of the company, who is responsible for the debts and related property obligations of the company within its charter capital The company has 4 main departments including marketing department, recruitment department, training department and sales department

3 Problem Statement

Our team's target community will focus on the Alibaba English Center for all ages who want to learn with a focus on everyday communication as well as in-depth communication Alibaba English Center was established in 2015, after 7 years of operation, the center has 7 branches nationwide and more than 40,000 students With a system of training and teaching processes focusing on basic daily communication for all ages, Ablibaba has affirmed its position in helping students practice listening and speaking English in real life However, when we went into the company's management system, we found that there was a gap due to weak cost management In particular, in the management of administrative costs, salary expenses, commission expenses, there are many weaknesses and loopholes that can lead to many serious consequences in improving the development of the company later After surveying and working with the company, we learned that there is no specific accounting department who will be responsible for recording all kinds of expenses and related documents And when recording all kinds of expenses will be due to Mr NCH, holds the position of lecturer vs cost control, after everyone uploads the data to a drive file for comparison Regarding salary, there will be an Excel file on Google Drive to control teaching activities as well as expenses after a lesson Moreover, when there are costs incurred, each employee is responsible for uploading to Google Drive the invoice or photo for comparison and payment to Mr NCH The Excel file would automatically calculate the amount of payables to workers in the formula:

Payables to Workers= Salary (based on their claims) + Expenses paid by them in advance Once Mr NCH alone takes care of all the work related to the costs incurred, it will lead to many loopholes Furthermore, because there is no accounting department in Alibaba, Ms LA, an employee of the sales department, is the trustful one to record the transactions in a journal based

on Drive file & based on Mr NCH’s checking at the end of the month However, Ms LA violated Circular 200 cost accounting principles because Mrs LA does not actively record expenses at the time of arising, but only records all expenses at the end of the month Due to the lack of strict cost management has led to the following consequences

The first issue, based on firsthand observation after working in this setting for a long time,

is administrative expenses for which there is no dedicated person or cost /asset management department In fact, lecturers/employees buy materials, print articles, parties and bonuses completely freely and upload expenses to Excel file, but this file is not paid too much attention Without a dedicated cash flow manager, photocopying, document printing, party money, bonuses, and fines are just a few examples,and without a warehouse manager, it's impossible to keep track

of vouchers, duplicate paperwork isn’t processed, and anyone can come and go from the warehouse This leads to shady, unsubstantiated expenses, which can lead to a lot of shady, fraudulent activity

The second cost concern is that payroll costs are quite complex In fact, lecturers and staff will automatically report the working day on an Excel file We found that Mr NCH was both a

teacher and a salary checker through his practical experience working at the company and looking through Alibaba's financial documents when asked by this group

Finally, according to company policies, you will be paid a commission if you recommend others to join the trial course About how to calculate the commission for each person, each employee has contributed to the company as cumulative points and the employee self-declares his contribution in the Excel file However, three incidents of employees generating bogus emails to register for a trial course were uncovered by December 2019, and those three employees were also

in charge of reviewing enrolled students As a result, I was able to deceive the number of students that signed up for a trial lesson in order to collect a commission The CEO has not yet discovered

a complete solution to the two challenges outlined above

This project will provide a way to solve the problems of cost management in the most appropriate way from our team's point of view This is the foundation for assisting firms in making operating estimates, as a labor estimate requires a norm of man-hours, and a norm of raw materials necessitates a norm of raw materials Furthermore, because standard expenses are the basis for evaluation, it assists managers in controlling business activities of the organisation by providing timely information for managers to make daily decisions, such as pricing a product, accepting or rejecting orders, and reviewing profitability More specifically, it ties each employee's accountability to the efficient use of resources It will positively affect the aspect of the community

in the long run A positive effect on the organisation is that it will help the company understand the costs of money coming in and out, easy to manage as well as reasonable allocation without wasting money Alibaba will be able to operate more efficiently, reduce superfluous expenses, and keep track of its finances with good corporate cost management

4 Literature review

4.1 Expense management in small and medium-sized businesses

In traditional accounting for costs, it is assumed that fixed costs are independent in the level of activity and variable costs change proportionately according to the changes in the level of activity Costs should be divided into fixed and variable ones Most management accounting expects that the proportion between costs and activity refers that a 1% increase in activity results

in a 1% increase in costs, and a 1% decrease in activity results in a 1% decrease in costs (Allen, 2007)

Cost management is a comprehensive index to measure the level of enterprise management Generally, firms with limited access to capital have higher internal costs including salary and rental expenses There are two categories in processing costs which are rational decision-making and motivational The rational decision-making treats expense as a consequence of weighting costs and economic benefits The other is motivation and stimulations, providing incentives to work, for example perks and bonus In some companies, rewarding staff for firm performance improvement has now become a common practice However, because some of the expenses are variable,

decision-making processes by management are put in several difficulties, which requires critical information (Rougnaghi, 2017)

Today, many firms manage their costs by utilising available resources such as hyman, machines and land When current operation results are not good as expected, it is the manager's critical decision whether to maintain those resources and keep the cost capacity in the short-term

or immediately cut those Unfortunately, most information related to expenses that managers receive is mainly from financial statements while a business can have various expense behaviors

It was long believed that administrative, general and selling costs vary according to activity level However, recent experimental studies have revealed evidence that the reduction in costs may lead

to lower quality in sales processing in the future (Anderson et al, 2019) Thus, in some cases, an increase in costs can result positively in business activities To decide firm cost and whether to deduct expenses, it requires a long process of consideration and analysis before imposing those costs to firms

4.2 Expense management for English-teaching centres in Vietnam

Truong Manh, a Vietnamese strategic manager, pointed out a common model for teaching centres in Vietnam

English-In his opinion, English-teaching centres in Vietnam commonly has to to financial issues due to poor expense management The cashflow indeed reflect the optimization of business operations Expenses are divided in 3 categories: marketing & sales expenses, managing and controlling expenses and others However, in Vietnam, English-teaching centres mainly assign a specific person, usually known as an accountant to control both revenue and expense situations, which is considered as the great lack of expenses management Hence, there is a great risk of monetary frauds The founder is suggested to proceed with a short-term step which is to review all

the transactions in the latest 2 months and then highlight those that may have least effect on the business operation to judge and decide omitting those transactions in the future Moreover, expenses for human resources should be considered because efficiency and effectiveness require

a thorough judgement, which comes to be the common weakness in most English-teaching centres Employees are overpaid than their potentials, leading to over- expenses (Truong Manh, 2021)

4.3 Recording expenses under VAS standard

Circular 200 applies to small to medium-sized enterprises with the scope of bookkeeping, preparation and presentation of financial statements Article 82 of Circular No 200/2014/TT-BTC defines that expenses are the accounts that decrease economic benefits and are recorded at the time

of occurring transactions or possibility of the future without already being paid or not (VAS,n.d) Moreover, the matching principle, which requires revenues and any related expenses should be recorded together at the same time, is also violated In addition, it is expected that the account should review evidence and reasonability for transactions by him or herself before recording, not just by relying on the others’ opinions and judgement Accountants should keep track of expenses such as wages, raw materials, depreciation of fixed assets, etc Moreover, expenses that are not considered calculated in taxes according to the provisions of the Tax Law but have sufficient invoices and vouchers and have been properly accounted for according to the current accounting policy shall not be recorded as a reduction in accounting expenses but adjusted in the tax finalisation to increase payable corporate tax All the expense accounts have no balance and at the end of the accounting period, all expense accounts incurred during the period must be transferred

to determine business results (Vietnam Finance Law, 2014)

4.5 Salary expense management

According to the internal auditing process for salary payables, Alibaba has now not fulfilled all auditing duties, especially the matter of lack of duty segregation There are 3 aspects that need to be reviewed periodically: incurring salaries expenses, calculating methods and

recording in the company Internal control judgement helps businesses to identify possible

misstatements and potential risk factors In terms of duty segregation, the managers or auditors

should proceed with internal control to check the segregated responsibility between human

resource department and accounting department In addition, internal auditors should check labour

contracts, documents and company policies which authorise specific payroll and commissions to

review recruiting procedure, payroll agreement and the independence in 3 different processes

(reporting working hours, paying salaries and recording salary expenses) Moreover,

payroll-related models in the company should be reviewed to prevent frauds and risks in payroll and duty

completion confirmation and records These are the most important functions because of its direct

and vast effects on salary expense management in the business (SCIC, n.d)

Today, with economic development, there is a need for towards-large-scale- companies for

building a firm salary management system Salary management system has a more complete

definition than the word “salary management “itself It is a combination of controlling human

resources and business operation as well as analysing company policy-making model and database

(Zhang et al, 2012)

Poor employee expense control can result in both employee dissatisfaction and higher cost

processing Therefore, expense management has become a crucial corporate function nowadays

In a research project, Suresh proposed using software as an effective way to manage the

employees’ detailed working days and working hours

(Captured from Suresh’s project, 2020) Below are the weaknesses that may be caused due to the lack of duty segregation

(Cited in an experiment from Audrey’s research, 2010) Looking at the experiment, in most small to medium-sized businesses, one person is assumed to be involved in many tasks Restriction in human resources may limit the number of employees, sometimes resulting in segregation of duties In addition, management’s daily involvement in material transactions can be related to mitigating segregation of duties issues Thus,

a senior manager is required to be involved in all material transactions and directly involved in financial reporting (Audrey, 2010) Audrey primarily suggested an additional management review and reconciliations to boost internal controls Moreover, if management review is internally applied, managers should have appropriate knowledge for both accounting and understanding of the underlying transactions that are being reviewed

MISA is considered a good application which helps small to medium sized businesses to control their expenses and utilise the business operation The new updated version can serve better business demand Misa not only help accountants to record but also organise, regulate and control the overall business It reflects the situation of expenses One of the distinct functions in MISA is controlling salary It allows various ways of calculating salary, tracing advanced payments, insurance and the process of payroll payment

4.6 Commission expense management

In an English-teaching centre, the driven target should definitely be sales that are English courses Therefore, performance-based commissions would be considered the best reward to motivate the sales team for their work engagement However, it could create an unhealthy competition in the company (Water, 2005) A salesperson may cut corners and use tactics that contradict the business's values just in order to grab the deals and thus receive their wanted commissions Occasionally, it is beneficial for the company when two or more salespersons work together as a sales team Different personnels support sales organisations to reach best solutions to identified accounts During the fiscal years, a company policy should be planned to utilise workforces and thus, motivate sales products (Sales Management Association, 2010) Managers could find it hard

to handle team members who earn different amount One of the key solutions is setting realistic targets To avoid conflict, the managers should proceed with regular one-to-one reviews to make sure that all expectations are synchronised together Furthermore, all managers need to check whether their staff bring compliance with the company's values which are some signals of tricky behaviours in order to get the fake deals Otherwise, the company may suffer from the risk of losing valued clients and deteriorating company's ethics and reputation (James, 2019)

5 Method of inquiry

5.1 Interview question designs

For the purpose of investigating the company, we carried out a thorough and qualitative interview in order to go into the company's inventory management Instead of questioning everyone at the same time, we performed individual interviews with each employee to guarantee neutrality and honesty, as well as willingness to provide personal information and thoughts about the inventory management of the firm We believe it is an excellent interview method that provides the quickest and clearest responses, facilitating data collecting and assisting the team in swiftly identifying challenges and solutions for the organization

On January 9, 2022 our team spent an evening researching and choosing together businesses and companies to choose as a project After 3 hours we decided to choose Alibaba company - an English center specializing in teaching communication

January 10 to 17 of the same year, we made an appointment with the CEO thanks to Ngo Thi Huyen's relationship to be able to get preliminary access to the company and get a rough map

of the set company's computer and ask for permission to view the company's documents After obtaining the approval of the CEO, our whole team accessed social media platforms such as websites, Facebook, fanpage to summerize about the company based on statistic about revenue, expense, source of capital, profit, human resource training to find information about Alibaba company more clearly We spent the whole evening, about 4-5 hours, reading together and briefly discussing the company

On February 7th to 14th for about 2 hours every night to meet together to analyze profit of company through financial statement & find some problems of company

Soon after, on February 15-20, we jointly did a preliminary survey and identified the serious problem is poor expense management At the same time, two of our members, Linh and Van, went to the company's working and teaching locations to have a certain and most objective observation about the company's working environment After that, our whole team spent a session designing the most reasonable interview questions and finding out the outstanding problems of the company

Unfortunately, because of the Covid19 pandemic, Cao Thu Huyen and Ngo Thi Huyen had

to set up an interview with the CEO and other employees online Specifically, on February 21, the two members spent about 2.5 hours talking to learn as well as interviewing the CEO with pre-designed questions and applying quantitative interview style Initially, the CEO of Alibaba refused

to provide much information related to the company's data for fear of leaking the company's private companies However, after we persuaded and discussed, he cooperated and we obtained a report

of costs incurred by facilities in Hanoi from 2018 to 2020 On February 23, two managers are Mr NCH and Mrs LA, we spent about 2 hours for the interview Thanks to the ingenuity in asking questions as well as creating a pleasant atmosphere when chatting, we have successfully learned some information that can help your project we add more attractions On February 26, we asked the staff and teaching assistants' permission to spend 15-20 minutes on questionnaires and we responded to employees' need to hide all identity information when doing questionnaires Even though I interviewed online, after the Covid19 epidemic, under control, C.T.Huyen and N.T.Huyen still come directly to the company many times to interact with employees as well as find more information and data on company issues

When summarising all the interview responses, the whole team spent about 7 days (from March 1 to 7) to develop project proposals From March 8 to 15, we evaluated potentials and drawbacks of problems

5.2 Data collection

5.2.1 Lecturer and teaching assistant responses

The survey was conducted by 35 people, including teaching assistants and lecturers When interviewed, they requested that their names be kept secret The survey results can reveal a lot about how experienced the majority of the company's lecturers are with their jobs It can be seen that 60% of the lectures who participated in the survey stated that they had been with the company for 1 to 2 years, while more than one-fourth of the respondents stated that they had been with the company for more than 2 years This demonstrates that the majority of participants consider the job to be full-time According to statistics, nearly half of them chose this vacancy because of their hobbies and interests, more than a third stated that they applied for the job due to financial constraints, and 20% stated that they do not have any other better job options With teaching assistants, they often work at the company for less than a year and consider the job as part time When we ask about how to record their expenses, most of them usually fill in the Excel file for their commutes and expenses incurred that day Those expenses will be recorded on the file along with the invoice However, many expenses will not have invoices or verification documents such

as photocopying, document printing Since the CEO doesn't provide payroll, we tried to collect the salaries of some employees who are module-based by course We would like to obtain the total number of open courses from 2018-2020 by course type

However, when lectures and staff self-record expenses as well as take attendance for lessons, many problems arise It is surprising that a large proportion of lectures in English centre feel this expense record is not complicated and unreliable, with approximately two third of the number of lectures Because they can easily get into class without being late or having their pay deducted When lecturers forget to take attendance in the excel file, they can easily file a complaint They can provide a transcript of that day's session or ask students who attended the class to verify

it for them The remaining lecturers feel that the way of recording expenses including salary and other expenses is not reasonable, accounting for 35% of the total number of lecturers of the centre They feel that such an expense record will not be reliable enough and are likely to forge invoices They also pointed out that it may happen that many teachers do not hold the class that day but still take attendance

To improve cost management, the chart has provided data showing the satisfaction level of teaching assistants as well as lecturers The large number of staff and lecturers feel rather satisfied

in the way of expense management, approximately 45% The other found neutral in managing expenses, they had no trouble recording their expenses, accounting for 20% The remaining 35% feel unsatisfied with such cost management Inconvenient cost management, sometimes causing staff and lecturers to confuse the total number of teaching hours as well as the incurred costs that are not accurately recorded

5.2.2 Response of company’s management team

Regard to company’s management team which has two members : Mr.NCH and Mrs.LA, Mr.NCH was both a teacher and a salary checker of the company; Mrs.LA is a sales department employee, who is trusted to record the transactions in a journal based on the Drive file and Mr NCH's checking at the end of the month When asked if they feel burdened while managing two responsibilities at the same time, they still feel very good with the job they are in charge of First, they said that this is not a serious problem in the company and currently still managing costs well

In their opinion, the criteria for calculating wages will be based on the number of hours which staff and lecturers take attendance on file as well as previous expenses incurred When asked about how

to evaluate salaries and expenses in the current company, they all felt that this method was quite simple, easy to compare, and did not take too much time to review However, when we asked about previous cases of expense violations, Mr NCH and Mrs LA seemed hesitant They also said that the costs incurred by staff and lecturers are sometimes not known precisely because many expenses (cash flow manager, photocopying, document printing, party money, bonuses, and fines) are not clear, and do not have invoices to compare Salary and management expenses are only checked and checked at the end of the month, so sometimes mistakes happen, they can't be checked correctly Especially, when our team asked them about cheating in commission expenses in 2019, they admitted that there was a case of taking advantage of company policies to benefit themselves However, the company has not yet found a solution to prevent similar incidents from happening

5.2.3 Response of CEO

With the CEO of the company – Mr Ngo Xuan Thang, he provided great freedom in the methods of acquiring information (e.g company tour, direct interviews and data requests) The CEO give us the total number of courses that the company opens from 2018 to 2020, divided by course type

He shows that the company has 4 main departments including the marketing department, recruitment department, training department and sales department In the company, Mr Ngo Xuan Thang also confirms Mr.NCH and Mrs.LA are responsible for cost management Because both of them are longtime employees, businesslike, Ms LA - staff with accounting degrees who are staff from the sales department and Mr NCH is both a teacher and a salary checker through his practical experience working at the company and looking through Alibaba's financial documents When we mention the company's expense management problem, he is very pleased and also confirms that the company's problem should be resolved immediately He realises that the company has a problem in the cost management gap and wants to strictly manage the cash flow problem in the company At first, he thought that cost management was controllable and easy to do, so he assigned the task to two longtime and trusted employees However, Mr NCH and Ms LA are multitasking,

so they cannot focus on and control costs continuously Many issues such as salary, bonus, incurred costs, space rental costs, and management costs are clearly declared and the CEO is extremely confident It was not until the cheating in commission case was revealed that he realised the

company's poor expense management He shares that he wants to focus on managing cash flow in and out, he is also calculating the cost if the company sets up an additional accounting and auditing department However, temporary measures to deal with violations in the company as well as reduce the possibility of repeating the same mistakes have not been clearly given

6 Results of the projects

Based on the in-depth research about the company and above literature review related to expense management, the detailed problems in controlling expenses in administration, salary and commission have been discovered in Alibaba English Center Unfortunately, most of the employees themselves find the current expense management is not effective and reliable

First of all, there is a problem of managing expenses incurred in the training process of the company, such as the costs of printing documents and books for students, the cost of rewards for students in the class there are good achievements in the classetc because the number and quality

of students in each class is different, the deduction of bonuses is not clear

During the teaching process, in addition to the materials for practice that students are given

by the center to support their learning, when they go to class, the teaching assistants or lecturers will distribute additional materials only when they study directly that session Because the lecture

of each class is different and the number of students in each class is different, these documents are

in charge of the teacher of that class, before each class, the teaching assistant will print documents for the students of the class with the amount of advance teaching assistant money to the company, and this total amount will be compiled by the employee himself into the company's salary file without going through any confirmation In addition, during class, teaching assistants or lecturers can buy gifts for students who have good achievements in the learning process and this depends

on the teaching style of the lecture, and these gift figures are not unequivocally proven as to whether the figures are accurate or whether the gift purchase took place

Thereby, the absence of any individual or department to manage those incurred expenses leads to employees being able to falsify data to fill in the payroll to cheat that amount

Instead of providing a specific policy on the teaching process, the company allows teachers

to create rewards, for example gifts and course-ended parties, to boost student morale but does not limit the budget for those rewards Those rewards could be purchased by teaching assistants or lecturers without being authorised Moreover, the expenses for rewards will be claimed by the individual employees in the salary file provided by the company without any confirmation Therefore, it is a high risk that the exact amount spent on rewards could be overstated

Secondly, the greatest problem in salary is the lack of segregation in the reconciliation and recording process According to NCH and LA’s answer in the interview, confirmed by other employees, the responsibilities in those processes are now ambiguous All the employees now freely upload their working results in an Excel File checked by Mr NCH, a teacher and a salary manager at the same time Moreover, although salary is expected to be checked twice (by NCH

and L.A) before recording, it can not be sure that is a thorough double check or to be simply just based mainly on the Excel file provided by all employees Overall, those current methods of salary expense reconciliation and recording in Alibaba are simple and effortless, but there is a great risk

of salary overstating and fraud covering among colleagues

Realising those problems, authors believe that the ultimate solution for Alibaba now should

be building up an accounting apartment in the future However, to deal with urgent situations, the company should hire an accountant specialised in reconciliation and recording all transactions It could be better if Alibaba can set up a time attendance machine with a fingerprint scanner to record the employee’s working results fairly and effectively and prevent covering up the frauds (e.g shift switch among colleagues and students’ covering up and fake confirmation on absent teachers) Moreover, the use of MISA software to mainly manage salary and then the whole company’s operation should be taken into consideration because MISA is suggested for Vietnamese small to medium- sized businesses

Last but not least, it is a problem related to commission expenses that the CEO feels most helpless, which drives us to find thorough action plans that may perhaps bring some significant impacts on company’s staff operation through policy change Currently, Alibaba introduces a commission policy unofficially (by speech) that “Commission expense is calculated based on the number of students who register in trial courses” The policy has been considered not suitable with the company Evidently, in December 2019, there were 3 staff members who created fake emails for trial courses to receive high commissions Significantly, those 3 staff were ones who reconciled each other’s working result Since then, even though the CEO has not found any other cases, the commission expenses are still high (shown in Bảng kê khai chi phí theo năm 2018-2020- Appendix) From all that information gained from research, it is an urgent plan that the company should build up an official policy of commission (in text) and publish it publicly within the whole inner organisation structure There are some suggested modifications The commission must be calculated based on the revenue gained by the real number of students in the official courses with detailed guidance For example, the company is now focusing on Communication courses more than Grammar courses, but Vietnamese people now prefer to learn Grammar than Communication Therefore, it is impossible to pay commission on these courses the same as those courses Moreover, the number of students should be considered the result of commission to raise the sales team’s motivation Now, Alibaba’s policy which states that “Up to 100 trial students will get 500.000 VND” is unclear It perhaps tells the reason why some staff felt less motivated and then faked emails That was when the staff and the company did not share the same goal- focus on the company’s growth The commission results should be reconciled by the third party to avoid covering frauds (as Salaries situation) Policy in detail would be mentioned in our Action plans

From those outlined action plans, it is believed that processing a fingerprinted salary machine and a printer could be easier and less time-consuming However, when Alibaba wants to control their expenses tightly, it should start with building official and detailed policies including Bonus and welfare funds and Commission It is our tough responsibility to help Alibaba to build