October 8, 2020
If you haven't had a lot of time to worry about fraud and your internal controls recently, you're probably not alone. Many organisations facing a survival situation during COVID-19 may not have had the time or energy to devote resources to the prevention and detection of fraud. But should you?
Many employees may have increased motivation to commit fraud due to issues with job security, economic uncertainty, personal or family health problems and abrupt change. The Fraud Triangle which describe the factors present when fraud is occurring include:
Internal controls focused on the prevention and detection of fraud may not be operating effectively in a remote environment, such as:
-> seggregation of duties
-> verification of receipt of goods/services more difficult
-> overrides of controls to complete tasks may be more frequent
What can you do to address these risks? Some suggestions include:
-> understand how remote working with lower levels of human interaction may have impacted the effectiveness of your internal controls
-> pay particular attention the supplier payment controls
-> increase transaction review and exception reporting to identify anything unusual
-> investigate when you suspect there may be the possibility of fraud - don't leave it until when get things return to normal
It can take a significant amount of time under normal circumstances for fraud to be detected. In a COVID-19 environment with many employees working from home it may take even longer with severe financial impact.
If you would like to discuss options for strengthening your organisation's internal controls or have concerns about fraud, please don't hesitate to contact us. We are here to help.
- 2018/19 Year-end Individual Tax Return Checklist
- 2020/2021 Federal Budget
- ALP Key Tax Policies
- ATO warning regarding annual leave loading and OTE
- COVID 19 – Federal Government Support
- Deferred repayments. Is accrued interest on deferred loans tax deductible?
- Fast-tracking tax cuts for small and medium businesses
- Fraud risks in a COVID-19 environment
- How financial advisors can build trust
- How to apply for JobKeeper & Key Dates
Copyright © 2020 Knight Public AccountantsRockhampton | Accountant | Tax | Xero | Audit
Made with Zakazukha