Contents

Executive Summary

Chief executives should address fraud as both an ethical issue and as an organisational disease which impedes performance. Fraud wastes scarce funds and resources. It causes embarrassment to the organisation and can damage its reputation and competitiveness.

It is a policy requirement in NSW for government agencies to implement a strategy for the prevention of both internal and external fraud. The policy directive makes it quite explicit that chief executives are directly responsible in this regard.

Despite strong and continuing evidence of the extent and resilience of fraud in both the private and public sectors, managers often seem to develop a curious overconfidence in the adequacy of their fraud protection, or worse still not to accept that fraud may exist in their organisation.

The purpose of this Guide is to assist government agencies to undertake the work required to develop and implement the form of dynamic and comprehensive fraud control strategy necessary to acquit their responsibilities. Importantly, it will enable them to do so in a manner which meets their needs and their situation.

The Guide also provides a benchmark for agencies to extend or embellish elements of fraud control which may already be in place.

To be of continued use into the future the Guide provides a means to assess the continued relevance, thoroughness and cohesiveness of fraud countermeasures in operation within an agency.

The Guide has been written for public sector executives and line managers as well as for audit/fraud control professionals. Both internal and external fraud is addressed, as is both fraud prevention and detection.

The Guide presents and advocates a strategic approach to fraud control. The model upon which the Guide is based deliberately seeks to focus attention at the macro strategic level in the first instance. It then provides a schema for assessing matters and actions to be addressed at the detailed level.

The conceptual framework presented is equally applicable to large and small agencies; simple and complex ones; and regardless of whether the agency operates as a commercial, regulatory, policy or administrative body.

The publication of this Guide provides a resource to improve the effective management of public resources. It fills a significant gap and thus represents a contribution of substance to ongoing public sector performance improvement.

Acknowledgements

The Guide is based upon a model for fraud control developed within the Performance Audit Branch of the Audit Office of NSW (the Audit Office) as a corollary to a 1993 performance audit which examined fraud control across the NSW public sector.

Stephen Horne, Principal Performance Auditor, and Warren Burton were responsible for all aspects of the project. This included conducting the performance audit, developing the conceptual model and the complete preparation of this Guide.

Final production of the Guide was coordinated through the Office of Public Management, Premier's Department (OPM) by Bill Healey, Karin Callaghan and Tania Sweeney.

The illustrations were prepared by Shane Collinge, the layout was arranged by Susannah O'Ferrall and the covers were designed by Ruth Downes.

Thanks go to those agencies who provided samples of various fraud awareness and training materials they had prepared, and also to the many individuals and organisations who assisted by providing useful comment and feedback.

How the Guide is Organised

This Guide has been divided into three volumes as follows:

• conceptual framework (volume 1)
• strategy (volume 2)
• diagnostics (volume 3)

Each volume begins with an outline of its focus and purpose. A consolidated detailed index of terms and topics is included at the back of this volume. Details about obtaining further information and about purchasing this Guide are also provided at the back of this volume.

About this Volume

A brief background is provided on the development of policy requirements for fraud control in New South Wales (NSW). This is followed by definitions and information on estimates of the extent of fraud. An analysis is provided of the current state of fraud control across the NSW public sector, leading onto an explanation of the basis and use of the fraud control framework advanced by this Guide.

NSW Government Policy Requirements for Fraud Control

Attempts to control fraud are nothing new.

In the NSW public sector various responsibilities in this regard (either direct or implied) have been provided or defined for many years by instruments such as the Public Finance and Audit Act (and its predecessor legislation prior to 1983), the Treasurer's Directions issued under that Act, and other pronouncements such as the Treasury Internal Audit Guidelines. Relevant formal standards have also existed for many years in the accounting profession generally and particularly in both the internal and external auditing professions.

Internal audit and/or inspection and/or investigation mechanisms exist in varying forms within most agencies or are provided through contract arrangements. All agencies are subject to independent external audit requirements. Codes of conduct have been a part of public sector practice for many years. Recent times have also seen a number of very useful reports and guides in the corruption prevention area published by the Independent Commission Against Corruption (ICAC).

However, in both the public and private sectors the indications are that despite all such measures fraud continues to exist. It is exceptionally resilient.

In September 1988 the Audit Office commented that "taxpayers tolerate fewer frauds and errors in the public sector than would be the case with shareholders in the private sector. Accordingly ... greater effort needs to be made to achieve a higher level of accountability in this area" (1988 Report to Parliament, Volume 2, page 110).

Moves towards instituting a specific policy on fraud control across the NSW public sector were initiated in November 1988 and developments at the Commonwealth level were widely circulated for examination and comment during 1989.

Volume 2 of the Auditor-General's 1989 Report to Parliament set out a number of factors or steps towards fraud control which agencies should address (pages 113-114), including "establishing a policy on fraud prevention".

In December 1989 a Draft Fraud Control Plan Relating to Internal Fraud for the State was released by the Minister for Police and Emergency Services prepared as a starting point. OPM was given responsibility to finalise the matter.

In March 1990 the Treasury issued a circular directing agencies to ensure that the fraud control factors identified in the Audit Office's 1989 report were being closely observed. Soon thereafter the Premier's Department formally articulated a policy on fraud control for government agencies.

On 7 June 1990 the Premier's Department advised all agencies of a new policy requirement for each agency to establish a strategy for the prevention of both internal and external fraud.

The form and means of implementation of this policy was left to the discretion of individual chief executives. Chief executives were requested to examine the specific situation in the agencies under their control. This was to include an assessment of the particular nature, form and level of fraud risk relevant to their organisations, and existing countermeasures. Chief executives would subsequently be responsible for determining and activating appropriate measures.

The Nature and Extent of Fraud

The development of a specific policy requirement by the Premier's Department relating to fraud control suggests that the matter is one of great importance. But just what is fraud? What impact can it have on an agency? Why should chief executives devote any resources to addressing fraud control?

Fraud and Corruption

There are many definitions of fraud available. At its simplest, fraud could be regarded as any practice which involves the use of deceit to confer some form of financial benefit upon the perpetrator (either directly or indirectly) AND which results in some form of material loss to the entity defrauded. More complex and technical definitions are readily available which may give different perspectives upon fraud. A definition which has been used by the Audit Office is:

Fraud can be defined as a deliberate and premeditated turn of events which involves the use of deception to gain advantage from a position of trust and authority. The type of events include: acts of omission, theft, the making of false statements, evasion, manipulation of information and numerous other acts of deception (1993 Report to Parliament, Volume 1, page 13).

Care should be taken not to misinterpret any definition as giving exclusive or greatest emphasis to internal fraud which is sometimes referred to as "workplace fraud". It is essential that the concept of fraud used by an agency clearly also includes external fraud which is sometimes referred to as "customer or client fraud".

A concise definition of corruption is even more difficult. In general terms corruption involves improper acts or omissions; improper use of influence or position; and/or improper use of information. This is not an exhaustive definition. The Independent Commission Against Corruption Act 1988 (ICAC Act) should be consulted if a more extensive definition is desired (refer to volume 2 of this Guide). Forms of corruption can be identified which do not clearly involve both material gain to the perpetrator and material loss to the subject entity (at least in quantifiable financial or economic terms). As such, corruption is often regarded as the broader issue with fraud representing a subset within it (although a very major subset).

It is not the intention of this Guide to suggest or imply that fraud and corruption should be treated separately or either one given priority or greater emphasis. A balanced, integrated and holistic approach is required. These concepts are fundamental to the model upon which this Guide has been based.

Agencies may consider that the framework provided by this Guide can serve as a means of dealing with corruption generally. However, this Guide makes no pretext of attempting to deal with all possible dimensions of corruption. It would scarcely be possible to do so. This Guide focuses specifically on the issue of fraud, as it is a major and specialised area which requires particular attention.

The conceptual framework advanced by this Guide provides a useful device for planning, executing and coordinating overall corruption prevention efforts.

The Magnitude and Impact of Fraud

As part of its ongoing campaign to sensitise and inform public officials and the community alike on the issue of corruption generally, during 1993 the ICAC ran a billboard campaign employing the rightly strong theme of "corruption costs more than you think". The damage done to organisations by fraud and corruption can be truly enormous. Damage may take many forms other than simple financial loss. Whilst dollar-damage may itself be very substantial, damage done to organisational performance, reputation, credibility, public or market confidence, and ultimately perhaps even to the organisations's ongoing viability may be even more significant.

Given this and the nature of fraud itself, reliable estimates of the extent of fraud and its impact are difficult to obtain. Arguably much if not most fraud may be undetected. Even where fraud is detected, often it is not openly prosecuted or publicly reported due to the nature of organisational embarrassment or damage which could result.

Widely varying estimates of the extent of fraud have been made.

Results of the National Survey of Crimes Against Businesses released in October 1993 by the Australian Institute of Criminology indicated that 26% of businesses had reported experiencing fraud during 1992 (the survey period). The accounting firm KPMG Peat Marwick surveyed 850 of the nation's largest companies during 1993 and found that 44% of respondents had experienced some form of fraud over the preceding year.

What of the financial impact of fraud?

An estimate was reported in the business media during 1993 of $15 billion per annum being lost in Australia every year from workplace fraud. As an illustration, that figure was reported as equating roughly to BHP's annual turnover. Some conference advertisements have proposed that "many companies will lose between 1-5% of their revenue to fraud".

Is fraud primarily a phenomenon of the private sector? What of fraud in the public sector?

The 1992 Commonwealth Parliamentary Banking, Finance and Public Administration Inquiry reported that federal public sector fraud was running at between $4 billion and $9 billion annually. The Australian Institute of Criminology has put this figure at $13 billion. The Commonwealth Auditor-General has used private sector estimates indicating that fraud in an organisation is likely to be in the region of 2-5% of turnover.

By any estimate, the problem is immense and appears not to be isolated to any particular sector, industry or type of organisation.

Chief executives should address fraud as both an ethical issue and as an organisational disease which impedes performance. Fraud wastes scarce funds and resources. It causes embarrassment to the organisation and can damage its reputation and competitiveness.

Effective Fraud Control - the NSW Scene

The 1990 policy requirement for fraud control issued by the NSW Premier's Department established a broad but non-specific policy platform for fraud control. The Audit Office had publicly stated its intention to examine the adequacy of fraud prevention arrangements within the public sector once agencies had been given a reasonable time to consider and respond to the policy directive.

A performance audit of this issue was carried out during 1992-93. Forty agencies were surveyed during the audit. A variety of agencies were selected ranging across both the inner and outer budget sectors and all major portfolio areas of the NSW public sector. Twenty five of the Audit Office's thirty largest and most complex audit clients were included within the sample. Fifty five per cent of the agencies surveyed were statutory authorities, 45% were departments. The combined operating expenditure of these agencies was in the vicinity of $30,825 million in 1991-92.

The primary objective of the performance audit was to make an assessment of the extent to which effective implementation of the policy directive had occurred. Results were reported within Volume 1 of the Auditor-General's 1993 Report (presented to Parliament 15 June 1993). Figure 1.1 below summarises those results.

The performance audit concluded that 50% of agencies for the most part satisfied audit criteria for fraud control strategies. A further 15% met a number of the criteria but their strategies were considered to require further enhancement. Thirty five per cent were regarded as unsatisfactory with their strategies requiring considerable development.

Generally, the majority of the larger agencies surveyed appeared to have been both active and comprehensive in their response to the Premier's Department fraud control directive. However, the Audit Office reported that only 20% of agencies surveyed were rated at the level which was suggested should be adopted as the service-wide standard (i.e. in the "highly effective" category).

Standard practice for performance audits requires development of a set of audit criteria to assist in the evaluation of fraud control strategies at the agencies selected for review. Substantial research was undertaken for the development of such criteria, both of actual fraud control plans and practices across a number of environments and levels of government and of the voluminous professional and general literature available on the topic (covering both the public and private sectors).

As evaluation continued over time these criteria were formed into various separate categories. Ten "attributes of effective fraud control strategies" were ultimately defined which represent the schematic framework that evolved from the audit process and around which a model for fraud control was able to be designed.

The model represents what the audit's research indicated are the key dimensions to which an agency should direct its attention in developing and implementing an effective, comprehensive approach to fraud prevention and control. It has therefore been advanced as a constructive contribution to assist agencies in the challenge which confronts them.

A Strategic Model for Fraud Control

What the Model Does (and does not do)

The model upon which this Guide is based deliberately seeks to focus attention at the macro strategic level in the first instance. It then provides a schema for assessing matters and actions to be addressed at the detailed level.

It is important to recognise that the model is not highly prescriptive in its nature. To do so would be to undermine its entire philosophy; namely that each agency must develop a strategy tailored to its own internal and external environment, the business it is in, and hence the level, nature and forms of fraud risk it may be exposed to.

The proposed model adopts a strategic approach to fraud control.

A prescriptive model could fall foul of the "lowest common denominator" syndrome and thus leave some agencies badly exposed. Alternatively, if the standards were set at a high level to cover a worst case scenario some agencies may unnecessarily waste resources. Perhaps worst of all, a prescriptive model may tend to discourage agencies from properly and seriously examining their own situation by encouraging a simple compliance response. This would utterly fail in achieving the outcome of chief executives taking proper responsibility for fraud control within their agencies.

The model recognises that each agency is unique and will need to implement a strategy to suit its individual requirements. Each agency must develop a strategy that is needs-based and cost-effective. Whilst this Guide will identify relevant issues to be addressed it is the responsibility of each agency to assess their own situation, determine their own needs and decide how best to proceed.

The model is adaptive and should not be implemented blindly or without regard to needs and resources required.

The model is basically a very simple instrument. It is a means of effectively organising ideas and efforts. It is a device for both encouraging and assisting management to see the big picture - and hence to gain confidence that there are no gaps. As a result the chief executive is better able to effectively acquit the responsibility which the Premier's Department policy directive demands.

The model serves as a conceptual, analytical, planning and review tool.

What the Model is all About

The model embodies the "critical factors for success" which it is suggested an agency should address in seeking to develop and implement its approach to fraud control. The "ten attributes of effective fraud control strategies" upon which the model revolves are depicted in Figure 1.2 below.

Figure 1.2: Ten Attributes of Effective Fraud Control Strategies

A brief outline of the key concepts and issues associated with each attribute follows. The outline has been designed for use primarily by chief executives and other senior staff to enable them to quickly come to terms with the model and what it suggests are the key matters to be addressed.

Attribute 1: Integrated Macro Policy

Each agency should possess a Fraud Control Strategy as a clearly identifiable instrument at the policy level. The strategy should detail the agency's stance on fraud. Many separate policy and action elements may be required for the strategy to be sufficiently comprehensive. The strategy must be properly conceived and constructed to effectively draw all elements together to form a holistic and complementary raft of fraud countermeasures. Whilst a number of fairly standard elements will exist for all agencies, considerable variation is also likely depending on factors such as the nature of the agency's environment and the business it is in. For the strategy to represent both an appropriate and cost effective instrument suitable detailed analysis must be conducted to develop or select those specific policies, measures and actions most appropriate to the individual agency.

Attribute 2: Responsibility Structures

Organisational responsibility for the coordination, monitoring, ongoing review and promotion of the agency's overall fraud control strategy, and for each of its sub-elements, must be clearly defined and communicated throughout the agency to management and staff alike. Fraud prevention and control must not become the exclusive domain of elite groups within the agency. All levels of management and staff must be kept involved in an appropriate manner.

Attribute 3: Fraud Risk Assessment

A structured fraud risk assessment review should be conducted periodically covering all functions and operations of the agency. The review must address both the internal and external environments for the agency, and the fraud risk associated with both. The review will establish the level, nature and form of the agency's fraud risk exposure. A forward plan generated from the review will subsequently define areas where specific action may be required.

Attribute 4: Employee Awareness

A well constructed program of ongoing initiatives is required to bring the issues of fraud prevention, detection and reporting to the attention of all employees. A series of different programs and approaches may be required to suit differing types of employees and corporate cultures within the agency. Training may be required to be delivered in a variety of different forms and contexts to be effective. Training may represent just one of a range of actions required. Best-practice guides for particular areas of activity may be helpful to assist staff and line managers to identify improvements needed to operational practices and local monitoring and control arrangements. Systems should be developed to monitor and evaluate sources of best-practice information and to disseminate relevant information within the agency as appropriate.

Attribute 5: Customer & Community Awareness

There is a need to promote community awareness that fraud committed against an agency is not acceptable and that perpetrators will be prosecuted. It is in the best interests of agencies to demonstrate an honest, ethical and businesslike provision of services to its customers through efficient policies which prevent and detect both internal and external fraud.

Attribute 6: Fraud Reporting Systems

Procedures for dealing with the notification of fraudulent activity need to be carefully developed and distributed to all potential complainants. An appropriate reporting structure should reflect the size, structure and nature of the agency; the number, type and deployment of its employees; its customer base; and its links to the community.

Attribute 7: Protected Disclosures

A policy should clearly indicate that management encourages people to come forward and report instances of fraud and corruption. Legislative provisions for disclosure protection provide minimum standards in this area. To be truly effective, measures will need to positively encourage fraud reporting whilst also addressing protection against recrimination; the prevention of false and mischievous reports; and appropriate behaviour by complainants in pursuing a complaint.

Attribute 8: External Notification

Each agency needs to develop a clear formal policy and detailed procedures for the reporting of fraud and corrupt conduct to relevant external authorities. Fraud is a criminal act. The Police and the ICAC must be advised. Other bodies may also be relevant in particular situations and should be defined as part of the agency's overall policy.

Attribute 9: Investigation Standards

Appropriate procedures and guidance should be provided to both operational and internal investigating staff to avoid any uncertainty or confusion as to how any matter should proceed and be handled. Particular care needs to be taken to ensure that competent fraud handling and investigation procedures are implemented. This is particularly important at the preliminary stages so as not to prejudice or hinder further investigation. Staff training may be required, possibly including specialist training for selected staff.

Attribute 10: Conduct and Disciplinary Standards

A clear message needs to be received by all employees that fraud will not be tolerated and that perpetrators will face disciplinary action. Codes of conduct provide a starting point only in this regard, and a range of further actions may be considered necessary to achieve an effective result.

The preceding outline can be put to use in a variety of ways.

It will assist chief and senior executives in performing any executive level review of fraud control material presented to them. It will also assist them in directing relevant questions on fraud control to line managers and to those officers given functional responsibilities for fraud control within the agency.

The outline can also be used with good effect by both internal review staff and line managers themselves to perform a quick overview-type review or "gap analysis" to gauge the adequacy of existing fraud control measures in place.

A high level review of this sort should be undertaken initially to determine where greatest effort may need to be directed in the first instance to put this Guide into operation within the agency.

How the Model Works (and how to use it)

The model is two dimensional. In order to develop an effective fraud control strategy an agency will firstly need to give detailed consideration across the full spectrum of its nine substantive attributes (i.e. attributes 2 to 10). This can be referred to as the "breadth" dimension.

After consideration, it could be that an agency would regard certain attributes as wholly irrelevant to them and not requiring any action. Whilst research indicates that this is unlikely, it is a possibility. So long as an agency could demonstrate that it had adequately considered the matter prior to its rejection then there should be no cause for criticism.

However, the model's second dimension then requires consideration. Within each attribute there are numerous possible issues and actions to be addressed. Agencies will need to undertake the necessary analysis and evaluation to determine how far they need to go under each attribute. This can be referred to as the "depth" dimension.

The fraud control model is two dimensional.

In considering the detailed elements and actions required to form up the strategy it is important to recognise that the model does not seek to override other approaches or action for fraud control (some of which may already be in operation within the agency). Rather the model seeks to bring them all together in an effective and integrated way. All of the commonly known fraud countermeasures, actions and approaches can be constructed within the broad dimensions of this model.

However, some of those other specific actions or elements, if used in isolation without a broader conceptual framework in place, may tend either to focus too much or too quickly on a specific area of action (such as organisational culture or employee attitudes) or at a detailed level of action (such as fraud risk assessment). There is nothing wrong with such actions. Indeed they, and a number of other possible actions, must all form part of an agency's attack on fraud. Each such area of action represents somewhat of a speciality with each usually having a considerable body of literature and expertise behind it.

The weakness with approaches which may cause an agency to focus on specific areas of detail too quickly is that a variety of additional or alternative avenues of action may tend to be overshadowed or overlooked.

Even if other lines of action are subsequently considered there could be a risk that they are formulated in such a way that the separate actions do not effectively complement one another. In a worst case scenario such separate actions could possibly even contradict or detract from one another. At the least there is a risk that other vital elements may not have been considered at all.

Having determined all of the specific elements considered necessary to address the nine substantive attributes, attribute no. 1 must then be addressed. It requires that all of the defined specific elements be considered from a macro perspective (to ensure their compatibility and comprehensiveness) and be constructed so as to form a fully integrated package.

The primacy of this macro integration feature is recognised in the model by placing it at the top of the list of attributes. This requires the agency to consider the extent to which the raft of policies, actions and measures developed are able to work together in an effective and constructive manner. It also prompts the agency not to overlook any important issues and to consider whether its strategy is truly holistic and comprehensive.

After having worked through each of the model's ten components an agency will be in an excellent position to ensure they have a strategy for fraud control which is both effective and appropriate to their needs.

Putting the Guide to Work

The other volumes of this Guide put the model into operation.

Volume 2 systematically works through the ten attributes of the model, providing discussion and guidance upon the key elements involved with each attribute.

Volume 3 provides a series of diagnostic checklists for the ongoing review and evaluation of fraud control strategies.

The Guide has thus been designed to be of relevance and practical use both now and into the future.

Consolidated Index

note: references are given in the form x:x indicating volume number followed by the page number within that volume.

annual reports 2:33, 3:6

Annual Reports (Departments) Act 1985 2:99

Annual Reports (Statutory Bodies) Act 1984 2:99

Archives Office of New South Wales

General Records Disposal Schedule -

Personnel Records 2:54

attributes, fraud control

see: fraud control, attributes

audit, role and responsibilities 2:9, 2:18, 2:65-2:68

Audit Office of New South Wales,

discrepancies, notification of 2:46, 3:9

fraud control performance audit 1:3, 1:11, 1:12, 2:2

fraud definition 1:7

Performance Audit Branch 1:3

public sector accountability 1:5

Report to Parliament,

Volume 2 1988 1:5

Volume 2 1989 1:6

Volume 1 1993 1:7, 1:11, 2:9

waste, disclosures of 2:41

Australian Accounting Standards 2:65, 2:68

Australian Institute of Criminology,

National Survey of Crimes Against Business 1993 1:9

estimates of fraud 1:10

awareness,

employee 1:17, 2:28-2:34, 3:5

customer and community 1:8, 2:33-2:34, 3:6

best-practice guides 1:17, 2:29, 2:31, 3:5

checklists, diagnostic 3:2-3:13

Committee,

Audit 2:11

Fraud Control 2:10

Commonwealth Parliamentary Banking, Finance and Public administration Inquiry 1.10

Commonwealth Auditor-General 1:10

conduct,

Code of 1:5, 1:20, 2:60, 3:12

standards 1:20, 2:59-2:64, 3:12

confidentiality 2:43, 2:92

corruption,

definition 1:7, 2:88-2:90, 2.95

prevention 1:8

survey of views, ICAC 2:40

notification, ICAC 1:19, 2:41, 2:88-2:100, 3:9, 3:10

Crimes Act, 1900 2:45

Crown Solicitor 2:46, 3:9

culture,

corporate 1:17

change 1:17, 2:10, 3:5

customer and community awareness 1:18, 2:33-2:34, 3:6

customer service standards 2:34

data protection principles 2:43, 2:52, 2:54, 2:82-2:84

diagnostics,

management 1:16-1:20

detailed 3:2-3:13

Director of Public Prosecutions 2:46, 3:9

discipline standards 1:20, 2:59-2:64, 3:12

employee awareness 1:17, 2:28-2:34, 3:5

ethics 1:18, 2:30

external notification 1:19, 2:44-2:46, 2:84, 3:9

fraud,

awareness program 2:29-2:32, 3:5

common methods and types 2:69-2:70

corruption versus 1:8

database 2:26, 3:4

definitions 1:7

estimates of,

Australian Institute of Criminology 1:10

Commonwealth Auditor-General 1:10

Commonwealth Parliamentary Banking, Finance and Public Administration Inquiry 1992 1:10

KPMG Peat Marwick 1:9

limitation matrix 2:23-2:24

magnitude and impact 1:9, 2:4

nature and extent 1:7, 2:4

notification,

Auditor-General 2:46, 3:9

ICAC 2:44, 2:88-2:100, 3:9-3:10

Local Government, Department of 2:92

Ombudsman 2:46, 2:92, 3:9

Police 2:44, 2:92-2:93, 3:9-3:10

possible indicators 2:71-2:73

reporting systems 1:18, 2:35- 2:39, 3:7, 3:11

risk assessment 1:17, 2:17-2:27, 3:4

risk profile 2:20-2:24

fraud control,

attributes for effective fraud control strategies,

general concepts 1:12, 1:15

integrated macro policy 1:16, 2:2- 2:7,3:2

responsibility structures 1:16, 2:8-2:16, 3:3

fraud risk assessment 1:17, 2:17- 2:27, 3:4

employee awareness 1:17, 2:28- 2:34, 3:5

customer and community awareness 1:18, 2:33-2:34, 3:6

fraud reporting systems 1:18, 2:35-2:39, 3:7, 3:11

fraud control continued:

protected disclosures 1:19, 2:40- 2:43, 3:8

external notification 1:19, 2:44- 2:46, 2:88, 3:9

investigation standards 1:20, 2:47-2:58, 3:10-3:11

conduct and disciplinary standards 1:20, 2:59-2:64, 3:12

Committee 2:10-2:11, 3:3

cost effectiveness 1:10, 1:4, 1:16, 2:5, 2:25

comprehensive approach 1:12- 1:16

critical factors for success 1:15

diagnostics 1:16-1:20, 3:2-3:13

draft Plan Relating to Internal Fraud for the State 1:6

employee participation 2:28

format, strategy 2:4

executive level review 1:16, 1:21

gap analysis 1:21

holistic approach 1:12-1:16, 2:5, 3:2

implementation, strategy 2:6

key dimensions 1:12, 1:15

model,

general concepts 1:3, 1:12-1:15, 1:21- 1:23

dimensions 1:21-1:22

New South Wales scene, public sector fraud control 1:11-1:12, 2:4

performance audit 1:3, 1:11-1:12

policy requirements 1:5, 1:6, 1:11, 1:13

prevention manager 2.12-2:13

relevance and importance 1:9- 1:10

schematic framework 1:12, 1:15

strategic approach 1:13, 2:25

strategy 1:13, 1:16, 2:1-2:4

Treasury, fraud control circular 1:6

Freedom of Information Act, 1988 2:43, 2:85-2:87

Further information 1:28

Guarantee of Service 2:34

implementation,

costs and resources 2:7

matrix approach 2:6-2:7

plan 2:6

timeframe 2:6

timetable 2:6

Independent Commission Against Corruption,

Act of 1988 1:7, 2:45, 2:77, 2:88- 2:92

corruption prevention 1:5, 1:9, 2:61

investigation 2:44-2:58

Guidelines for Reporting by Public Authorities of Possible Corrupt Conduct to the Commission 2:45, 2:52, 2:92- 2:100

Effective reporting of Corrupt Conduct Within Government Departments and Agencies 2:35- 2:38, 2:77-2:81, 3:7

notification 1:19, 2:41, 2:44, 2:47- 2:49, 3:7, 3:9

retention of records 2:54

survey of views on corruption 2:40

Institute of Internal Auditors (Australia) 2:67-2:68

integrated macro policy 1:16, 2:2-2:7, 3:2

interference by management in investigations 2:51

internal audit,

Public Accounts Committee Report No. 71 2:68

responsibilities 2:9, 2:65-2:68

Treasury guidelines 1:5

investigation,

initial 2:47

plans 2:50

reports,

final 2:55-2:56

follow-up 2:57

interim 2:54

responsibilities 2:49

role of management 2:51

standards 1:20, 2:47-2:58, 3:10- 3:11

tips 2:58

Local Government, Department of 2:92

maladministration, disclosures to Ombudsman 2:41, 2:92-2:93

management

attitudes 2:3

good practices in combating fraud 2:74-2:76

involvement 1:16

responsibilities 2:8-2:10, 2:13- 2:14, 2:17-2:18, 2:65-2:68

role in investigations 2:51

model for fraud control,

see: fraud control, model

Minister for Police and Emergency Services 1:5

National Survey of Crimes Against Business 1993 1:9

natural justice 2:43

notification, external 1:19, 2:44-2:46, 2:88, 3:9

Office of Public Management 1:3, 1:5

Ombudsman 2:41, 2:46, 2:92, 3:9

Personnel Handbook 2:45, 2:49, 2:54, 2:62, 2:63

Police Service,

notification 1:19, 2:44-2:45, 2:47- 2:50, 2:82-2:93, 3:10

fraud investigation 1:20, 2:47- 2:58

Premiers Department

Office of Public Management 1:3

policy requirements 1:5, 1:6, 1:11, 1:14, 2:2, 2:34

Privacy Committee of NSW 2:43, 2:48, 2:52-2:54, 2:82

professional standards 2:9, 2:65-2:68

protected disclosures 1:19, 2:40-2:43, 3:8

Public Accounts Committee of New South Wales, Internal Audit in the NSW Public Sector, report No. 71 2:68

Public Finance and Audit Act, 1983 1:4

Public Sector Management,

Act, 1988 2:43, 2:45, 2:62

General Regulation 2:43

purchasing the Guide 1:28

records,

data base 2:26, 3:4

disposal 2:54

investigations 2:48, 2:54, 3:11

protection 2:54, 3:11

reporting systems 1:18, 2:35-2:39, 3:7, 3:11

responsibility structures 1:16, 2:8-2:16, 3:3

risk assessment 1:17, 2:17-2:27, 3:4

Statement of Auditing Practice AUP16 - The Auditor's Responsibility for Detecting and Reporting Irregularities Including Fraud, Other Illegal Acts and Error 2:66

Statement of Auditing Standards AUS1 2:65

strategy

see: fraud control (various items)

Treasurer's Directions 1:5

Treasury, Internal Audit Guidelines 1:5

waste, disclosures to Auditor-General 2:41

Further Information

For further information please contact:

The Audit Office of New South Wales

Level 11, 234 Sussex Street

SYDNEY NSW 2000

Ph (02) 285 0155

Fax (02) 285 0100

To purchase copies of this Guide please contact:

NSW Government Information Service Retail Shops:

Ground Floor

Goodsell Building

Chifley Square

cnr Elizabeth and Hunter Streets

SYDNEY NSW 2000

Ground Floor

Ferguson Centre

130 George Street

PARRAMATTA NSW 2150

Telephone Orders:

Ph Metropolitan (02) 743 7200

NSW Country (008) 46 3955

Fax (02) 743 7124