This exam incorporates the shoulder as well as the arm and neck since they connect to the shoulder. The overall goal of the exam is to check for muscle, ligament, joint and nerve damage.
Here are the specific steps:
Check all ranges of shoulder motion (extension, flexion, external/internal rotation).
Check all ranges of neck and elbow range of motion (because the same muscles connect to the shoulder).
Check front and side posture of the shoulder looking or an internally rotated or raised shoulder.
When checking ranges of motion observe signs of pain, pinching in the joint, weakness or finger tingling.