Strategic Plan in Relation to Fraud—2017-19

Introduction

Definitions

Mandate

Composition

Roles

Guiding principles

Appendix A

Introduction

In March 2016, the Executive Committee discussed the Office’s role in maintaining the integrity of the public sector and found that the Office must help public sector entities manage the risks of fraud, collusion and corruption. In addition, the Executive Committee considers managing the risks of fraud to be a strategic issue that could impact the Office’s reputation. The Office recognizes the importance of training auditors to sensitize them to the risks and signs of fraud. To that end, it will continue to develop and maintain expertise and resources in this area.

Definitions

Fraud: An intentional act by one or more individuals among employees, management, those charged with governance (internal), or third parties (external) involving the use of deception to obtain an unjust or illegal advantage.

The three primary categories of internal fraud are corruption, asset misappropriation and financial statement fraud.

Mandate

The Fraud Support Team, including the internal specialist, provides support to the Office though fraud risk assessment, preventative and detective controls and investigations of fraud. The team’s work assists the two audit practices, Corporate Services and other internal OAG clients and liaise with external partners.

Composition

The Fraud Support Team is led by the Internal Specialist for Fraud. The Internal Specialist for Fraud is supported by the members of the Office’s Fraud Support Team. They are part of the audit teams of both practice groups and service groups (Appendix A). They contribute to various fraud related initiatives at the Office, which are part of their regular workload. The Team includes Certified Fraud Examiners, and professionals with an interest in the field.

Roles

Role of the Office in relations to fraud

The Office wishes to help public sector entities manage their fraud risks through proactive risk identification and assessment, fraud risk related audit work, and forensic audits.

Role of the Internal Specialist for Fraud

The internal specialist is responsible for

• Advising and supporting the audit teams in assessing fraud risks, identifying fraud indicators, and other aspects related to fraud;
• Identifying and implementing corporate projects related to fraud;
• Supporting the Office’s internal structures and activities related to the Fraud Risk Assessment and the Fraud Risk Management Framework;
• Coordinating the activities of the Fraud Support Team;
• Developing and maintaining the competencies of the Team’s members;
• Deploying fraud related benchmarking and outreach activities; and
• Ensuring the involvement of Legal Services.

Role of Certified Fraud Examiners

The role of the Certified Fraud Examiners is to support the internal specialist in carrying out various projects that will allow the Office to achieve its fraud related objectives in relation to fraud. This will enable them to develop and maintain their competencies in this area.

Role of professionals interested in the field

The role of professionals interested in the field is to participate in projects identified by the internal specialist, thereby contributing to achieving the Office’s objectives in relation to fraud and to their professional development in this specialized area.

Guiding principles

We support a variety of stakeholders within and outside the Office in relation to fraud. These are our objectives:

Audit teams with regards to their audit work:

• Help audit teams proactively assess fraud risks (related to entities and their activities);
• Help audit teams reduce and manage fraud risks (related to entities and their activities);
• Foster mutual cooperation;
• Strive for excellence and effectiveness in the advices we provide and the services we deliver;
• Monitor fraud risks related to entities and their areas of activity; and
• Ensure that Office practices conform to the requirements of applicable standards.

Internal Services

• Help Services and Practices assess, reduce, and manage the Office’s fraud risks;
• Build positive and productive relationships, and promote cooperation and partnerships;
• Ensure that fraud policies, processes, and protocols respect best practices, are clear, and are understood by all, including employees from services and audit practices; and
• Ensure that Office practices conform to the requirements of applicable standards.

Fraud Support Team members

• Continue to develop and maintain expertise;
• Share expertise in day-to-day work; and
• Educate colleagues about fraud, including fraud risk assessment, fraud prevention, and fraud detection.

External stakeholders (federal entities, central agencies, provincial and international counterparts, professional associations, etc.)

• Support the Office’s undertakings and organizational partnerships in relation to fraud; and
• Cooperate and set an example: share information, knowledge, and best practices with other parties from provincial governments, international governments, and other parties from outside government.

Overview

This document describes the Fraud Support Team’s initiatives to support the Office in its objectives. The Team’s priorities are determined both during the annual strategic planning exercise and in discussions regarding the service and practice groups’ needs.

Objectives

OBJECTIVE 1—Address fraud risks in the Office’s three products

This objective involves properly assessing and, where necessary, mitigating fraud risks in the OAG’s three products.

Sub-objectives

• Help audit teams proactively assess and manage fraud risks;
• Help audit teams to identify fraud indicators;
• Help audit teams that encounter situations involving potential fraud; and
• Proactively integrate the Fraud Support Team members in audits.

Initiatives supporting this objective

• Provide the necessary support to the audit teams from both practice groups in proactively managing fraud risks;
• Identify audit projects with a higher risk of fraud, collusion;
• Identify areas for improvement to methodology and tools in relation to fraud;
• Ensure that the Office has staff with the necessary knowledge, competencies, and experience to carry out the work required in relation to fraud or perform forensic audits; and
• Monitor the internal and external fraud risks related to entities.

Key performance indicators

• Implementation of projects that monitor the risks of fraud of entities;
• Development of new tools to help teams assess fraud risks and identify fraud indicators; and
• Development and implementation of a new targeted fraud training program.

OBJECTIVE 2—Contribute to managing the OAG’s fraud risk

The purpose of this objective is to support the Chief Financial Officer in managing fraud risks at the Office and to monitor and improve the Fraud Risk Management Framework.

Sub-objectives

• Examine the fraud risk assessments of all service and practice groups as part of the strategic planning exercise;
• Monitor the fraud risk management framework and identify areas from improvement;
• Support the service and practice groups in assessing and managing fraud risks; and
• Support the services in fraud-related investigations.

Initiatives supporting this objective

• Evaluate the fraud risk assessments of all service and practice groups;
• Reassess the Office’s fraud risk management framework;
• Continuously improve the Office’s Fraud Risk Management Framework; and
• Support and ensure coordination of investigation efforts of fraud allegations.

Key performance indicators

• Full annual assessment of the Office’s fraud risk; and
• Annual reassessment of the Office’s Fraud Risk Management Framework.

OBJECTIVE 3—Maintain the capacity to address fraud

The purpose of this objective is to ensure that the OAG has the human resources to meet the needs of practice and service groups in relation to fraud. We wish to develop and maintain the Office’s competencies in this area and have a succession plan in place.

Sub-objectives

• Develop and maintain the competencies of the Fraud Support Team’s members by participating in various initiatives;
• Implement corporate projects to maintain and develop capacities in relation to fraud; and
• Value the capacities and competencies in relation to fraud.

Initiatives supporting this objective

• Integrate the Fraud Support Team’s members in the audits of both practice groups and in corporate projects;
• Involve members in forensic audits where necessary; and
• Use a variety of projects to support the objectives of maintaining and developing members’ competencies.

Key performance indicators

• Outcomes of the annual analysis of members’ participation in projects.

Project summary

#	Project	Deadline	Hours
			2017–18	2018–19
Objective 1—Consider fraud risks as part of the Office’s three products
P.1.1	Consultations—Internal Specialist for Fraud	Ongoing	300	350
P.1.2	Updating of tools and methods (three products)	Jan 18	1,150
P.1.3	Development of training	Jan 18 / Jan 19	450	350
P.1.4	Training			150
	Risk assessment—Practice groups
P.1.5	Database	Ongoing	275	125
P.1.6	Media review	Ongoing	175	175
P.1.7	Updating of fraud risks—entities	March 18	300
P.1.8	Maintenance of fraud risks—entities	March 19		300
P.1.9	Data analytics	Ongoing		350
P.1.10	Participation in audits	Ongoing	350	550
P.1.11	Benchmarking	Ongoing	100	125
Objective 2—Contribute to the OAG’s fraud risk management
P.2.1	Fraud Risk Management Framework	Ongoing	250	250
P.2.2	Fraud Risk Assessment—OAG	Ongoing	150	75
Objective 3—Maintain the capacity to address fraud
P.3.1	Coordination—Fraud Support Team	Ongoing	175	175
P.3.2	Outreach	Ongoing	55	125
	Projects P.1.1 to P.2.2 and P.3.2 contribute to achieve Objective 3
	Total project effort—2017–2019		3,730	3,100
	Time required by Internal Specialist for Fraud		1,160	1,175

Appendix A

Members of the Fraud Support Team

Michelle Robert–Internal specialist for Fraud and head of the Fraud Support Team

Julie Bastarache
Mitch Bowman
Karim Chebbi
Christianne Curry (in development)
Sabrina Gibb
Benoit Gosselin
Mathieu Lefèvre
Anthony Maki (in development)
Elisa Metza
Joseph O’Brien
François Toulouse

Professionals from the Office with an interest in relation to fraud will join the Team to participate in projects on an as-needed basis.