INTERNAL AUDITING & FRAUDS

Transcription

1 Amsterdam INTERNAL AUDITING & FRAUDS Piero MATRICIANI S.O. Compliance Auditing Internal Audit Department Ferrovie dello Stato Italiane Group

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4 TRANSPORT INFRASTRUCTURE REAL ESTATE OTHER SERVICES Principal Economic Data from the Consolidated Financial Statement Operating Revenues Operating Costs Gross Operating Margin (EBITDA) Operating Income (EBIT) Net Income (Numbers in millions of )

5 INTRODUCTION OCCUPATIONAL FRAUD Fraud committed by individuals who have an ongoing, fiduciary or in any case qualified relationship with the company.

6 INTRODUCTION DECEPTION ARTIFICES LIE SCAM FALSEHOOD MALICIOUS SILENCE

7 INTRODUCTION FRAUD PREVENTION INFORMATION HANDLING INVESTIGATIONS

8 TABLE OF CONTENTS FRAUD PREVENTION INFORMATION HANDLING INVESTIGATIONS

9 I. A. & FRAUD PREVENTION

10 I. A. & FRAUD PREVENTION HARD CONTROLS PREVENTIVE CONTROLS SUBSEQUENT CONTROLS (Deterrent)

11 I. A. & FRAUD PREVENTION TONE AT THE TOP FRAUD INTOLERANCE

12 I. A. & FRAUD PREVENTION Maslow s Hierarchy of Needs

13 I. A. & FRAUD PREVENTION 1. Code of conduct 2. Whistleblowing policy 3. Tone at the top 4. Tone at the middle 5. Mission in the vision 6. Employee background analysis 7. Flexible audit plan 8. The true table 9. Learning by the others 10. Training by experience 11. Lesson learned 12. Zero tolerance 13. Serious fraud department 14. Fraud management policy 15. FRAUD RISK ASSESSMENT

14 I. A. & FRAUD PREVENTION Fraud Risk Assessment 1. Fraud risks have to be considered stand alone

15 I. A. & FRAUD PREVENTION Fraud Risk Assessment 2. It would be useful to start from a framework

16 I. A. & FRAUD PREVENTION Fraud Risk Assessment 3. Risks are not lacks of control

17 I. A. & FRAUD PREVENTION Fraud Risk Assessment 4. Risks are not red flags

18 I. A. & FRAUD PREVENTION Fraud Risk Assessment Organizational principles Values pursued HR policy Methods to report irregularities INFORMATION AND COMMUNICATION Training Communication

19 TABLE OF CONTENTS FRAUD PREVENTION INFORMATION HANDLING Handling reports on fraud Handling information and documents INVESTIGATIONS

20 INFORMATION HANDLING Acquisition of information on fraud Management of information relating to fraud Management of the database of reports on fraud Dissemination of the Audit Final Report Management of the database of fraud schemes

21 INFORMATION HANDLING What is meant for REPORTS ON FRAUD? Direct reports on possible frauds Information incidentally acquired while performing IA engagements

22 INFORMATION HANDLING CENTRAL AUDIT DEPARTMENT Employer Corporate Departments Reports on fraud Chairman of the Board of Directors Chief Executive Officer Top Management Internal Audit Departments of Group s subsidiaries

23 TABLE OF CONTENTS FRAUD PREVENTION INFORMATION HANDLING Handling reports on fraud Handling information and documents INVESTIGATIONS

24 INFORMATION HANDLING Preliminary Assessment INFORMATION INFORMER

25 INFORMATION HANDLING RELIABILITY OF THE INFORMER

26 INFORMATION HANDLING Result of the preliminary Assessment

27 INFORMATION HANDLING Report on fraud Preliminary Assessment Manifestly groundless Not manifestly groundless Proposal to the Audit Committee Report Summary Sheet DATABASE of reports on fraud INVESTIGATIONS

28 INFORMATION HANDLING INVESTIGATIONS (Central Audit Department) Report confirmed by investigations AUDIT FINAL REPORT

29 INFORMATION HANDLING Dissemination of the AUDIT FINAL REPORT Legal & Compliance Department SELECTED RECIPIENTS: parties who have the power to take appropriate measures

30 INFORMATION HANDLING Audit Final Report FRAUD SCHEME Fraud scheme already surveyed New fraud scheme DATABASE of fraud schemes

31 INFORMATION HANDLING BENEFITS of identifying fraud schemes? It helps the preliminary assessment It helps on conducting investigations It helps on finding new red flags

32 summing up Report on fraud Preliminary Assessment DATABASE of fraud schemes Manifestly groundless Not manifestly groundless Proposal to the Audit Committee FRAUD SCHEME INVESTIGATIONS Report Summary Sheet DATABASE of reports on fraud Report confirmed by investigations Audit Final Report

33 TABLE OF CONTENTS FRAUD PREVENTION INFORMATION HANDLING INVESTIGATIONS Main features of Fraud Audit Regulatory framework Limits on investigations

34 INVESTIGATIONS NO GENERAL CONCLUSIONS ON THE I.C.S. VERTICAL APPROACH CONTINUOUS POINTS OF CONTROL NO MANAGEMENT AGREEMENT ON RESULTS

35 TABLE OF CONTENTS FRAUD PREVENTION INFORMATION HANDLING INVESTIGATIONS Main features of Fraud Audit Regulatory framework Limits on investigation

36 INVESTIGATIONS The fine tuning in search of a balance between competing claims

37 TABLE OF CONTENTS FRAUD PREVENTION INFORMATION HANDLING INVESTIGATIONS Main features of Fraud Audit Regulatory framework Limits and risks on investigation

38 LIMITS ON INVESTIGATION VIDEO-SURVEILLANCE SYSTEMS

39 LIMITS ON INVESTIGATION CUSTOM CORPORATE S AND WEB PAGES VISITED Employees corporate Web pages visited..

40 LIMITS ON INVESTIGATION SECURITY GUARDS

41 LIMITS ON INVESTIGATION SEARCHES ON WORKER S BODY

42 RISKS ON INVESTIGATION

43 THANK YOU FOR YOUR ATTENTION!