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Auditing Unethical & Fraudulent Practices in Procurement

Duration: 3 Days



The course is structured around, and focused on, understanding how to detect and prevent unethical practices in procurement. It is aimed at the internal auditing teams or anyone in a similar function.

Each module is underpinned by workshop-based, real-world case studies. The overall approach is geared towards facilitating and divulging information and skills relevant to the practical needs of the attendees, and includes the following topics:


  • Learn about the fundamental concepts that underpin the audit and management of the procurement process

  • Identify common fraud related practices

  • Understand how to spot unethical dealings

  • Evaluate and implement strong internal controls

  • Adopt a robust tendering and bidding process

  • Instill the right management practices and process for transparency and accountability

Overview of the Purchasing Cycle

  • Discuss the responsibilities of a typical corporate purchasing group and the purchasing business cycle

  • Understand who is involved (internal and external)

  • Identify differences in the purchasing cycle depending on the industry and company size

Purchasing Fraud Schemes

  • Classifications of purchasing fraud

  • Corruption

  • Asset Misappropriation

  • On and off book

  • Purchasing fraud schemes

  • Purchasing fraud statistics and industry comparisons

Risk-based Strategy to Fight Purchasing Malpractice

  • Purchasing fraud risk assessment

  • Fraud opportunity reduction through purchasing process improvement

  • Internal controls to reduce purchasing fraud risk

  • Proactive risk-based auditing to detect purchasing fraud

  • Investigations of purchasing frauds identified

Use of Internal Controls in Purchasing

  • Assess the level of purchasing fraud risk at your organization, including industry and geographic considerations

  • Define relevant internal control practices (e.g. explicit policies, segregations of duties, vendor selection, and independent centralized procurement group)

  • Review policies, processes, and approval limits

  • Exceptions to normal protocol (e.g. sole sourcing decisions and bid waivers)

  • Vendor monitoring and evaluation criteria

Fraud Detection Processes

  • Risk-based purchasing fraud detection audits

  • Using CAATS to detect purchasing fraud

  • Tips and complaints

  • Soliciting feedback from management, employees, the public and vendors (current, former and rejected)

  • Vendor monitoring

  • Monitoring of major contracts

Detecting Particular Purchasing Fraud Schemes

  • Scheme-based purchasing fraud symptoms and detection methods

  • • Special considerations for off-book purchasing fraud schemes

  • • Special considerations for contract bidding schemes

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