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December 11, 2014 (Thursday)

We know how to find fraud and simplify complex fraud cases. 

We can help you... 

  Learn how to conduct fraud audits;

  Learn fraud prevention strategies;

  Conduct fraud investigations;

  Provide expert witness testimony.

December 11, 2014 (Thursday)

Fraud Auditing 

Our experience shows... 

Fraud Auditing is the application of audit procedures to a population of business transactions in a manner to

increase the propensity of identifying fraud in core business systems. The goal is to identify fraudulent

transactions that warrant an investigation.

CLIENT ENGAGEMENT

Objective:

Uncover and identify fraudulent transactions in core business systems.

Results:

In five days, shell corporations were found in accounts payable. Revenue was overstated by $1 milliondollars through journal entries.

Fraud Risk Assessment 

Our experience shows... 

Acts committed upon the organization or by the organization or for the organization. The acts are committed

by an internal or external source and the acts are intentional and concealed. The acts are illegal,

misstatement, policy violation, ethical lapse or a perception issue.

CLIENT APPROACH:

There is no one way to implement a fraud risk assessment. The methodology selected is dependant on the

reason for performing the fraud risk assessment. Is the risk assessment to satisfy regulatory requirements,

audit requirements, internal control assessment or to locate fraud in a core business system? The drill down

question is at what risk level does management or the auditor desire to identify and respond to the risk of

fraud. We focus on fraud risk by:

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1. Macro Risk: Enterprise Wide Fraud Risk Assessment

2. Micro Risk: Business Process Fraud Risk Assessment

3. Mega Risk: Fraud Penetration Assessment

Risk Assessment Methodology

The enterprise wide fraud risk assessment is designed to provide a comprehensive identification of all

fraudulent activities facing an organization and linking the ownership and audit responsibility to the fraud

risk. The purpose is to create a structure for establishing ownership, assessing the likelihood of fraud

occurring, understanding the fraud impact and how the fraud risk will be managed. The enterprise wide

assessment focuses on the internal control environment for assessing the likelihood of the fraud risk

occurring. The fraud impact should be identified and understood. The organizational culture will determine if

a quantitative or descriptive approach will be used to document the fraud impact. Management’s goal is to

create a structure for managing the cost of fraud.

The business process fraud risk assessment is designed to identify specific fraud schemes at the business

process level and link the specific internal control procedures to the fraud risk inherent to the process. The

process wide assessment focuses on the internal control procedures, monitoring controls and the

information and communication controls. Management’s goal is to arrive at the risk mitigation decision. The

auditor’s goal while similar is intended to focus on the development of the audit program.

The fraud penetration assessment or the mega risk assessment is designed to identify the most likely

location of a fraudulent transaction in a specific account, transaction type, and business location. The

purpose is to develop a fraud audit program to locate and identify fraudulent activity before allegations of

fraud are identified through a hotline, tip or through some unpredictable event. The goal is to locate

fraudulent transactions in the core business system.

Tax Compliance and Advisory

Taxation Services

We offer a broad range of taxation services to small and medium enterprises to meet their tax compliance obligations

and responsibilities while identifying tax planning opportunities and providing specialised tax services to minimise

their tax liabilities within the existing tax regulations and framework at a reasonable fee.

In today’s dynamic and fast changing economic and business environment globally, small and medium enterprises

face a range of challenges that affect not only the success of their businesses, but also the professional and personal

goals of their owners. Whatever the end goal - an expansion into new markets, succession to a family member, or

sale - proper tax planning in managing and organising their investments and business transactions locally or abroad

is critical. Our professional services to small and medium enterprises will include entity income tax planning and

compliance services, individual tax and international tax planning using our worldwide network and contacts.

For individuals, including expatriates of multi-national corporations working in Singapore, we will provide them with

comprehensive tax solutions in the most tax efficient manner.

Our taxation services include:

  Corporate tax 

  Personal tax 

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  Indirect tax 

1.2 Investment framework

 Audit criterion: The Department has in place an approved investment planning framework. 

Deputy heads are responsible for implementing an effective management framework for

assets and acquired services, including departmental procedures, processes and systems,based on principles of stewardship and value for money.

The Department does have an approved Investment Planning Framework. The frameworkincludes: a reporting framework; project management guides, templates; and a guide andtemplate specific to Project Complexity and Risk Assessments. The Investment Planning

Framework is focused primarily on project investments and includes a description of projectmanagement governance, definitions, information management practices, performancemanagement and a description of key roles and responsibilities. Some elements of the

Framework were modified and presented at the Budget Day in February 2012, including an

updated governance model, project delegation process and a gating process. These updatesshould be made in the Investment Planning Framework to support management in theupcoming planning cycle.

As mentioned, the investment planning process has been designed to support an enterprise

approach. Interviews indicate that while some stakeholders recognized a standardized

enterprise approach for investment planning, others thought there was some flexibility inhow branches would conduct investment planning. More clarity around the enterpriseapproach could be documented in the Framework.

Through document review and interviews, the audit concluded that branches understood the

departmental requirements to identify, cost and select investments. However branch

officials did not always understand how to complete the process. In support of theimplementation of the approach to investment planning, the framework should providemore detail on roles and responsibilities at the branch level. While prioritization criteria were

included in the Investment Planning Framework, some new criteria were introduced duringthe current round of planning and should be updated in the framework.

The recommendation below includes a few areas where the Investment Planning Frameworkshould be updated. Some of these observations are discussed further in the report.

Recommendation 1 

It is recommended that the Chief Financial Officer update the Investment Planning

Framework to: update roles and responsibilities; formalize a planning strategy for moving

forward; identify priority areas and costing for non-project investments; strengthenintegration of investment planning with operational planning; and clarify the life-cyclemanagement process for all assets. 

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Management response 

Management agrees with the recommendation.

The updates to the Investment Planning Framework are consistent with the Department'sforward agenda for investment planning.

Regarding linkages with non-project investments or ongoing acquisition of assets and

services into the Investment Planning Framework, the Chief Financial Officer Branch will

review the scope of expenditures to be included in the Investment Plan and will work withrelevant branches to determine priority areas in non-project investment.