day 4: jo kremers, former senior audit manager audit ... · innovation in kr2, kr4, kr7, kr15 and...

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• Fraud Detection: a special focus on management verifications & audits on-the-spot

• The most important anti-fraud instruments / tools for verification, audit and

investigation

• Innovation in Key Requirements

• Data Analysis

• POLLINGS, BREAKOUT ROOMS and HANDS UP for interaction!

Day 4: Jo Kremers, former senior audit manager Audit Authority, Central Audit Services,

Lecturer for the National Academy for Finance and Economics of The Ministry of Finance,

The Netherlands (NL)

To successfully detect fraud in ESI Funds, auditors and controllers whoperform audits on operations or management verifications on the spot,should make use of some very important tools.

Let’s see the polling question, then the answer, an introduction and anexplanation

TOOLS

CASE 1 POLLING!

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Now let us test the good functioning of those tools, by use of the following 4 cases….

observation ……..

For your eyes only……….. TOOLS CASE 2

POLLING!

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Immediately PUSH the HAND functionality in Zoom if you have a / any suspicion because of the picture and the explanation given

1. Please look at the picture2. Explanation3. Your opinion

TOOLS CASE 3

HANDS UP in ZOOM!

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An ERDF-funded project:

Project : a Municipality wants to upgrade the old historic harbour of the city bymaking it more attractive for tourists. Among other things the Muncipality thinks ofunderground waste containers as part of a new waste management system.

The waste management system, as written in the project plan: in order to solve thegrowing problem of litter and waste left behind by tourists that visited the oldharbour. They (the tourists) can offer their garbage for free to the system, for free to

stimulate them to do so.

Underground containers for garbage as aesthetic "pillar" will save space andpreserve the aesthetics of the environment.

TOOLS CASE 4

HANDS UP in ZOOM!

For your brains (and eyes) only………..

look to the following picture and answer the question

TOOLS CASE 5

POLLING !

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Virtual Coffee Break …tour de table!

This training has been organised by EIPA under the Framework Contract Nr 2018CE16BAT060. The opinions expressed are those of the contractor only and do not represent the EC's official position

Innovation in KR2, KR4, KR7, KR15 and KR16

in general and in specific for combating fraud & co rruption

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Technical information

Implementation and realisation

Realisation in accordance with project objectives

publicity

Innovation in KR2, KR4, KR7, KR15 and KR16 in general and in specific for combating fraud & co rruption

Council decisions and minutes (to be found on the internet)

An example, a case presented by Jo (out of his own practice)

EXAMPLE

Innovation in KR2, KR4, KR7, KR15 and KR16 in general and in specific for combating fraud & co rruption

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use of internet and social media , another CASE / e xample

The conversion of an old clothing factory and warehouse into a Conference Centre, named XYZ, with Banquet Facilities for public activities only

Instead of just focusing on your on-the-spot-visit you can innovate and perform your activities in a more effective, successful and efficient way

by the use of internet and social media

Regarding the risk as defined,

what could be effective search terms when visiting the internet and social media?

Case Search Terms : An ERDF-funded project

BRING YOUR IDEAS IN

THE CHAT OF ZOOM!


use of central databasesan exercise by use of your own laptop /

tablet / smartphone

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Use of Central Databases (1)

� Case: Does this service / service provider (of that subsidised project) really exist?

� Imagine you are performing a management verification or an audit on an operation.

While checking some invoices, because of reimbursement of expenditures, you get a

feeling there is something strange regarding :

� the supplier’s VAT identification number under which the taxable person supplied the

goods or services

and

� the supplier’s full name and address

� the layout and template of the invoice

QUESTION: How could you check the information ?



� Nando (New Approach Notified and Designated Organisations) Information System

� Notification is an act whereby a Member State informs the Commission and the other

Member States that a body, which fulfils the relevant requirements, has been

designated to carry out conformity assessment according to a directive. Notification of

Notified Bodies and their withdrawal are the responsibility of the notifying Member

State.

� Lists of Notified Bodies can be searched on the NANDO web site. The lists include the

identification number of each notified body as well as the tasks for which it has been

notified, and are subject to regular update.

� NANDO-IS – conformity assessment bodies – bodies responsible for conformity

assessment of products marketed in the EU.This training has been organised by EIPA under the Framework Contract Nr 2018CE16BAT060. The

opinions expressed are those of the contractor only and do not represent the EC's official position

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� All types of documents provided by beneficiaries to obtain grants, or to participate in a

public procurement process or for reimbursement of expenditure, may be affected by

forgery:


• Contracts • Identity papers • CVs • Bank guarantees • Balance sheets • Invoices (paper or electronic) • Reports • Timesheets • Attendance lists • Websites • Other

Jo will introduce it now to you…

A very innovative, very effective and accurate NEW TOOL

for project management & control, security, verification and audit

and NOT to forget, for combating Fraud and Corruption:

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Now just some examples since there are many sophisticated tools for combating Fraud & Corruption

Falsification / manipulation of paper docs:

How to detect it / how could it be detected in the past?

Now in e-cohesion and our digital world:Jo explains …

CASE 1: FALSIFICATION

Fraud by Plagiarism in project plans and creating fake projects

How to detect it?

A case of fraud based on plagiarism

CASE 2: PLAGIARISM


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Fraud detection by use of Open source Intelligence

Use of f.e. NameScansan example….

CASE 3: OPEN SOURCE

INTELLIGENCE


Fraud detection by use of Open source Intelligence

This tool of PEP lists , Sanction lists and Adverse Media Checks

Very useful for : KR 2, especially when the beneficiairy is a City, Municipality, Province or University

think about mayors, councilors, provincial administrators, etcso as part of the MCS in set up / functioningKR 2 selection of applications, and the inherent risks of this; and please do not forget KR 2 is an ESSENTIAL KR !!!!!!!!

And KR 4, 7 , 15 and 16 !!!!!!!

My personal and professional recommendation in these :

For many more tools and practical exercises how to make use of tools,and realistic life like cases, stay in touch !

INTELLIGENCE

CASE 3: OPEN

SOURCE

INTELLIGENCE


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Data Analysis, very effective, behind desk

by use of the most important instruments,

to detect fraud

ERDF-case: sustainable roofs and questionable subsi dies

The internal audit department of a government body (Agency A) that grantssubsidies for the energy sustainability of industrial buil dings , detectedsubsidy frauds thanks to a whistleblowing notification . Both the external financialauditor and the internal audit department they did not notice or detect these fraudsbefore.

How could this happen? How can you improve the quality of internal & externalaudit activities?

First an overview of the process and the executive organisation …

CASE 4: SUSTAINABLE

ROOFS

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an overview of the process and the executive organisation :

The employees of the Agency assess the incoming subsidy applications of potential beneficiaries and, afterinternal approval based on more eyes principle , the Agency pays the amount of the subsidy.

One of the ERDF supported programmes is a low-threshold subsidy for companies. The subsidy is granted onthe application of an energy-saving coating on company buildings. There is a lot of interest in the programme.

For each application, a maximum subsidy amount of EUR 75,000 can be granted and paid out. A subsidy maybe applied to and awarded for a maximum of once per company building .

The government has ordered a strong emphasis on services; the turnaround time and complexity of theapplication procedure must not slow down applying to and the granting of the subsidy (and thus theapplication of the energy-saving coating ).

ROOFS

CASE 4:

SUSTAINABLE

ROOFS

ERDF-case: Sustainable roofs and questionable subsi dies

The financial audit

The implementing agency records the subsidies paid as costs in its financial statement. This is audited by a financial auditor.

Part of the audit activities by the external auditor:- analytical review of the subsidies paid (amount versus number of applicants).- various detailed checks on the processes of assessment, the approval of applications, and the final payments- and the internal control measures included therein.

The auditor has no significant findings with regard to the internal controls and the subsidies paid.

The whistleblower notification gives information about non regular payments, a total of about €950,000 in the two previous calendar years.

ERDF-Case: Sustainable roofs and questionable subsi diesROOFS

CASE 4:

SUSTAINABLE

ROOFS

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BREAK OUT ROOM!

� Discuss in your group: How could this happen? How can youimprove the quality of internal & external audit activities?


CASE 4:

SUSTAINABLE ROOFS

FEEDBACK BY JO

Jo [email protected]

THANKS FOR YOUR ATTENTION.

ANY QUESTIONS?

day 4: jo kremers, former senior audit manager audit ... · innovation in kr2, kr4, kr7, kr15 and...

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