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DISCUSSIONS > FRAUD [ REFRESH ]
Thread Title: Fraud Scenarios In The Manufacturing Industry
Created On Wednesday February 08, 2012 5:19 PM
  Fraud Scenarios In The Manufacturing Industry
  Fraud Scenarios In The Manufacturing Industry
  Fraud Scenarios In The Manufacturing Industry
  Fraud Scenarios In The Manufacturing Industry


SHY


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Joined: Feb 2012

Wednesday February 08, 2012 5:19 PM

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Hello All,

I am looking for assistance in identifying common fraud scenarios in the manufacturing industry.

My company wants to integrate fraud risks into our current IA program. So we would like to know best practices of other companies who integrate fraud to their program. Also, do you have any templates (e.g., checklist) that are utilized to identify potential fraudulent activities?

Your assistance will be greatly appreciated.

Thanks.

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Buddie


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Thursday February 09, 2012 1:53 PM

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Not knowing what industry your manufacturing is makes this difficult but I will give it a general stab with this list.

Theft of inventory, over valuing inventory for book purposes due to off quality or shelf life, receiving less quantities or quality that reported in inventory records from suppliers, under reporting off quality production measurements or waste of materials to avoid exceeding maximum thresholds , kick backs with waste or off quality goods sold to outside buyers, fraudulent physical inventory records, look at customer returns of your product for missing inventory, prepare monthly inventory clearances of BEGINNING INVENTORY BALANCES + RECEIPTS + RETURNS - ISSUES or PRODUCTION = THEORETICAL ENDING INVENTORY for raw materials, supplies, WIP and finished inventory to see if any pluses or minuses are missing, make sure all work order or goods issue orders are numerically accounted for. Good Luck.

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COBOYD


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Wednesday June 27, 2012 5:52 PM

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Here are some things I have seen or heard of in the past:
- utilizing company assets to perform work in off company hours
- stealing tools is a big one, either by taking from tool bins, or ordering extra and taking the excess
- setting up a false vendor, order and receiving imaginary items from them, and receiving payment from the company
- for manufacturing co's with many locations, where they are accepting payment for services rendered - taking the checks and cashing them
- placing false receipts in the petty cash fund

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aimen


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Joined: Oct 2012

Tuesday October 09, 2012 3:42 AM

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inventory theft,
fake moment in obsolete stock so that they will remain un-highlighted.
collusion with supplier and fake inspections of faulty materials so they will then eligible for payments claims.
fake production losses and fake efficiency of output respectively.
workers are more in such organisation so threat of ghost employees are also there.
do not forgot to put control of unpaid salaries and wages or overtime.they must be firstly verified from internal audit deptt then they should paid to respective employee.

-------------------------
 Muhammad Aimen

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DISCUSSIONS > FRAUD [ REFRESH ]
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