Fraud Risk Assessment Tool
Module #14 – Conflicts of Interest
Conflicts of Interest schemes include:


Purchase schemes, which involve the overbilling of a company for goods or services by a
vendor in which an employee has an undisclosed ownership or financial interest
Sales schemes, which involve the underselling of company goods by an employee to a
company in which the employee maintains a hidden interest
Questionnaire Key
1. Are there periodic comparisons of vendor information with employee information, such as
addresses and telephone numbers?
Organizations should conduct periodic comparisons of vendor information with employee
information, such as addresses and telephone numbers.
2. Are vendors who employ former company employees under increased scrutiny?
Vendors who employ former company employees should be under increased scrutiny for potential
conflicts of interest.
3. Does the organization have a reporting procedure for personnel to report their concerns about
vendors receiving favored treatment?
Organizations should provide personnel with a confidential system for reporting concerns about
vendors receiving favored treatment.
4. Are employees required to complete an annual disclosure document that includes business
ownership, income, and investment information?
Employees should be required to provide annual disclosures that list business ownership, income,
and investment information.
5. Does the organization require vendors to sign an agreement allowing vendor audits?
Organizations should require vendors to sign an agreement allowing vendor audits.
6. Are vendor audits conducted by someone independent of the purchase, sales, billing, and
receiving departments?
Vendor audits should be conducted by someone independent of the purchase, sales, billing, and
receiving departments.
1
Fraud Risk Assessment Tool
Module 14- Conflicts of Interest
Yes
Are there periodic comparisons of vendor information with
employee information, such as addresses and telephone
numbers?
Comments:
Are vendors who employ former company employees under
increased scrutiny?
Comments:
Does the organization have a reporting procedure for
personnel to report their concerns about vendors receiving
favored treatment?
Comments:
Are employees required to complete an annual disclosure
document that includes business ownership, income, and
investment information?
Comments:
Does the organization require vendors to sign an agreement
allowing vendor audits?
Comments:
Are vendor audits conducted by someone independent of the
purchase, sales, billing, and receiving departments?
Comments:
2
No
Not
Applicable