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This section sets out some examples of controls which should be in place, in addition to those which apply generally to cash handling and purchasing systems, to counter the fraud risks faced in relation to the use of contractors:
| Fraud type: |
Normal tendering procedures are ignored as a result of collusion or cosy relationships between staff and contractors |
| Suggested controls: |
Consider using an approved suppliers list. This list should be updated on a regular basis, and any amendments appropriately authorised |
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Establish clear and unambiguous tendering procedures. Ensure that these procedures are being adhered to |
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Make sure that tenders are delivered to those responsible for selection without any interference |
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Do not accept late tenders |
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Require staff to declare any personal interests which may affect the tendering process. |
| Fraud type: |
Payments are made for work not carried out, as a result of collusion between the contractor and official |
| Suggested controls: |
Only pay invoices when they are accompanied by independent certification that the work has been satisfactorily been carried out; |
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Maintain a register of contracts in progress |
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Only add contracts to the contract register when they are properly approved and authorised |
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Document all contract variations, sequentially number variation orders which are produced in an agreed format and authorised before payment. |
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Make a check against the budget and planned expenditure prior to the approval of a payment |
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