In New Zealand, preventing and detecting fraud in an organisation is the responsibility of several parties.
1. Management: The primary responsibility for preventing fraud in an organisation rests with its management. Management is responsible for developing and implementing internal controls, policies, and procedures that prevent, detect, and deter fraudulent activities.
2. Board of Directors: The board of directors of an organisation is responsible for overseeing management's activities and ensuring that effective internal controls are in place to prevent and detect fraud.
3. Employees: All employees have a role to play in preventing fraud. They must be aware of the organisation's policies and procedures, report any suspicious activities they notice, and follow established internal controls.
4. Internal Audit: The internal audit function plays a crucial role in detecting fraud within an organisation. They are responsible for reviewing internal controls and identifying any weaknesses that could be exploited by fraudsters.
5. External Audit: External auditors are also responsible for detecting fraud within an organisation. They are required to perform an audit of the organisation's financial statements and are expected to detect any material misstatements caused by fraud.
Overall, preventing fraud in an organisation is a shared responsibility that involves multiple parties. By working together, organisations can develop effective internal controls and prevent fraudulent activities from occurring.
