FRAUD RISK ASSESSMENT TEMPLATE WITH SAMPLE POLICIES

1 FRAUD RISK ASSESSMENT TEMPLATE WITH SAMPLE POLICIES Appendix B - Departmental FRAUD Risk ASSESSMENT Forms Identified Areas of FRAUD Risk which are listed in first column of matrices below: T: Indicates Potential Theft or Misappropriation of Assets F: Indicates Potential Fraudulent Financial Reporting C: Indicates Potential for Corruption TOWN OF FRAUD Risk Management Plan (Departmental TEMPLATE ) Town Administrator/Town Hall Department: Location: Cash Collection: Yes or No Formal POLICIES and Procedures Manual: Yes or No # of Employees: FY 2018 EXPENDITURE BUDGET: FY 2018 ESTIMATED RECEIPTS: Identified Area of FRAUD Risk Current Control and Monitoring Procedures Current Recommendations Comments T,F Cash Collection Theft of funds FRAUD Management Plan Approvals Prepared by: _____ Department Head Approved by.

2 _____ Town Administrator SAMPLE Whistleblower Policy Whistleblower Policy Effective Date: POLICY General The Town of TOWN OR CITY requires employees to observe high standards of business and personal ethics in the conduct of their duties and responsibilities. As employees and representatives of the Town of TOWN OR CITY, we must practice honesty and integrity in fulfilling our responsibilities and comply with all applicable laws and regulations. Reporting Responsibility It is the responsibility of all employees to report violations or suspected FRAUD , including questionable accounting or auditing practices in accordance with this Whistleblower Policy.

3 No Retaliation No employee who in good faith reports a violation shall suffer harassment, retaliation or adverse employment consequence. An employee who retaliates against someone who has reported a violation in good faith is subject to discipline up to and including termination of employment. This Whistleblower Policy is intended to encourage and enable employees and others to raise serious concerns within the Town prior to seeking resolution outside the Town. Reporting Violations The Town of TOWN OR CITY has an open-door policy and suggests that employees share their questions, concerns, suggestions or complaints with someone who can address them properly.

4 In most cases, an employee s supervisor is in the best position to address an area of concern. However, if you are not comfortable speaking with your supervisor or you are not satisfied with your supervisor s response, you are encouraged to speak with someone in the Finance Department or anyone in management whom you are comfortable approaching. Supervisors and managers are required to report suspected violations or FRAUD to the Town Accountant. For suspected FRAUD , or when you are not satisfied, or uncomfortable with following the Town s open door policy, individuals should contact the Town s independent audit firm directly.

5 Finance Department The Town Accountant is responsible for investigating and resolving all reported complaints and allegations concerning potential instances of FRAUD or abuse and questionable accounting or auditing practices. At his discretion, he shall advise the Town Administrator, who has direct access to the Town s independent audit firm and is required to report to the auditor any FRAUD , abuse or questionable practices. Accounting and Auditing Matters The Town Accountant shall address all reported concerns or complaints regarding auditing practices, internal controls or auditing.

6 The Town Accountant shall immediately notify the independent auditor for the town regarding any such complaint, and work with them until the matter is resolved. Acting in Good Faith Anyone filing a complaint concerning a violation or suspected violation must be acting in good faith and have reasonable grounds for believing the information disclosed indicates a violation. Any allegations that prove not to be substantiated and which prove to have been made maliciously or knowingly to be false will be viewed as a serious disciplinary offense.

7 Confidentiality Violations or suspected violations may be submitted on a confidential basis by the complainant or may be submitted anonymously. Reports of violations or suspected violations will be kept confidential to the extent possible, consistent with the need to conduct an adequate investigation. Handling of Reported Violations The Town Accountant will notify the sender and acknowledge receipt of the reported violation or suspected violation within five business days. All reports will be promptly investigated and appropriate corrective action will be taken if warranted by the investigation.

8 Contacts Town Accountant Audit Firm Town Administrator _____ _____ Town Accountant Date Adopted by the Board of Selectmen on: _____ SAMPLE FRAUD Risk Policy FRAUD RISK POLICY The Town of TOWN OR CITY is committed to protecting its revenue, property, information, and other assets from any attempt, either by members of the public, contractors, vendors, agents or its own employees, to gain by deceit, financial or other benefits at the expense of the taxpayers.

9 Town officials and employees must, at all times, comply with all applicable laws and regulations. The Town will not condone the activities of officials or employees who achieve results through violation of the law or unethical business dealings. The Town does not permit any activity that fails to stand the closest possible public scrutiny. This policy sets out specific guidelines and responsibilities regarding appropriate actions that must be followed for the investigation of FRAUD and other similar irregularities.

10 Definitions occupational FRAUD is defined by the Association of Certified FRAUD Examiners as the use of one s occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization s resources or assets. There are three major categories of occupational FRAUD . Asset Misappropriations Theft or misuse of an organization s assets. o Cash Fraudulent Disbursements Perpetrator causes organization to disburse funds through some trick or device ( submitting false invoices/time card/sheets, expense reimbursement schemes, check tampering, etc.)