The circuit works correctly with the PMOS Field Effect Transistor source and drain connected as shown in the schematic. The diodes in the PMOS FDN340P unit are the issue of concern. Do not worry, the diodes will not cause trouble.
In the schematic, the source is on the right with the p type source shorted to the n-type substrate inside the unit. A protective diode is also in the unit. The other diode is not shown in the transistor symbol, but it exists where the p-type drain is metallurgically connected to the n-type substrate during silicon wafer manufacturing.
If the drain p-type material goes above the n-type substrate by 0.7 volts, the hidden diode will turn on with the forward bias.
The drawn diode in the unit duplicates the hidden diode from drain to substrate. This highlights for the engineer that : since the substrate is shorted to the source, there is a parasitic diode wired from drain to substrate that is shorted to the source terminal. The engineer wil recognize that applying a large voltage from drain to source will forward bias the parasitic diode. It is a bad idea to forward bias the substrate! That can provide a latch-up current problem if the geometries on the silicon are not robust.
The drawn diode symbol in the unit may be intended to prevent inductive spikes from causing damage to the MOSFET. It also indicates the polarity of the hidden diode from drain to substrate. The drawn diode may be a Schottky diode which turns on at 0.45 volts to prevent the pn junction diode from reaching 0.70 volts.
The datasheet Figure 6 implies that a Schottky diode is present, since 1mA flows at 0.45 volts at 25 degrees c. http://www.fairchildsemi.com/ds/FD/FDN340P.pdf
The schematic has it wired right. The diode seems to be a Schottky diode to prevent the pn diode from being forward biased, preventing latch up.
If the source and drain get reversed in this circuit, a problem can occur when the +5 volt node will supply the USB with current if the USB cable touches a ground or unpowered computer.