How can you manage fraud risks?
The potential for corporate fraud and misconduct to spread easily from a small brush fire into a full-blown firestorm has garnered the attention of standard setters and regulators. Increased attention to fraud by regulators has led to improvements in corporate antifraud programmes and provides a good roadmap for others to consider. It is no longer sufficient to simply react appropriately to issues brought to management's attention – it's necessary to act in advance.
Fraud issue reviews should be undertaken by those in charge of governance. A clear strategy will need to be developed and appropriate measures deployed to manage fraud risks. In addition, front-line operations and financial staff need to become effective first and second lines of defence. Therefore, rethinking the risks and enhancing the existing programmes and controls in place in order to be more efficient is key to actively managing fraud risks in a company.
The challenges you face
- You want to ensure that your company has a best-in-class framework, which addresses fraud prevention and detection activities.
- You want to be confident that processes in your company are adequate to uncover significant frauds and/or avoid claims of negligence if they occur.
- You want to make sure that you have the right processes for dealing with fraud or other inappropriate acts.
- You are looking to develop in-house expertise on forensic capabilities but at the same time have expert support when required.
How PwC can support you
PwC offers clients complete anti-fraud management solutions from diagnosis to prevention through to detection and remediation. Our goal is to transfer our knowledge in fraud management and forensics to enable you to develop a sustainable and efficient approach. PwC's global forensic team can also assist you in addressing local issues in specific markets. We can offer assistance in two key areas:
Support for executive and line management:
- We review and challenge the existing "fraud risk spectrum" to assure a common, comprehensive, agreed approach and appropriate involvement of the audit committee in the fraud and misconduct risk assessment.
- We determine the probability, size and potential impact of frauds, before assessing the costs and benefits of different solutions.
- We help you to assess your organisation's culture and management style and the adequacy of systems and monitoring controls. This allows us to create a picture of the existing anti-fraud control environment, to map specific risks and to show you areas under threat.
- Together with your team we develop cost-effective solutions that meet your business objectives and fit your organisation's culture.
- We help you implement targeted fraud auditing procedures, including the use of data mining tools.
- We implement processes to identify red flags for fraud and misconduct as well as a set of methods of performing a robust investigation, including coaching your team.
- In the case of allegation of fraud, we implement remedial actions, from recovering monies to enhancing and testing controls.
- We assist you in implementing an e-discovery process and help you improve your procedures for whistleblowing.
Support for the audit committee and management in incident handling:
- We help you define the roles of the functions, such as legal, compliance, human resources, external and internal audit, and of the audit committee.
- We assist you in communicating cases of fraud and provide support when issues are uncovered.
- We define the process for receiving and retaining information and help you to react appropriately when incidents involving suspected improprieties arise.
- We ensure an independent management process is defined for reviewing incidents to ensure challenges can be effectively answered.
- We offer special board advisors who can be consulted on the potential risk of fraud and misconduct attached to strategic decisions.
Contacts
Forensic Services (Western Switzerland), Leader Fraud,
Risks & Controls, Europe
Tel: +41 58 792 98 38
Of further interest
- Publication: Global and Swiss Economic Crime Surveys 2003–2009
- Publication: The Internal Control System: a rapidly changing management instrument
- Publication: Managing Through the Downturn
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