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Meaning A binding agreement between 2 ormore person that is enforceable by law

Buyer and seller

Offer, acceptance and consideration

Legal, binding and documented

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Procurement The act of getting possession ofsomething

Purchasing The acquisition of something forpayment

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Cost

Condition

Consumption

Compliance

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At the right time

For the right purpose

From the right source/suppliers

With the right specification and quantity

Based on the right quantity/amount

The right timing/period

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Ensure all the right items

Every process in CPP is correct and in order

Peace of mind

CPP dept meeting its objective and target

No controversy or scandal in CPP function

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Mistake

Careleness

Fraud

Bad reputation/image

Loss of investor

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Fraud An illegal act of decent, concealment or

violation of trustExample of fraud Crimes by individual against clients Employee fraud against employers

Crimes by businesses against investors, consumersand employees

Crimes against financial institution Crimes by professional criminals against major

organization Crimes by individual or businesses against

government E-crimes by people using IT

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Fraud = P + O + T

Corruption = M + D + A

P : People of organization

O: Opportunity

T: Target

M: Monopoly

D: Discretion of power

A: Accountability

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1. Pre fraud act

-Environment

1. Fraud Act

-Moment of truth

1. Post Fraud

-Attitudes

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Under table money

Conspiracy

Theft of stock

Improper purchase Fake vendors

Faking signature

Inflated bills Conflict of interest

Usage of companies properties for personalgain

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Management

Audit Committee

Audit Dept

Compliance

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Defective product/product substitution

Defective testing

Insider information

Bribery

Defective pricing

False invoice

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Suspension

With-hold payment

Forfeiture/default

Legal suit

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Strategic risk

Operational risk

Credit risk

Market/finance risk

IT risk

Other domain

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What is KRIs - Valuable guide or barometerfor the risk owner

Risk Identification

I. Know your CPPII. Identify all things that go wrong in CPP

III. Agenda

IV. ProcessV. Steps & control breakdown

VI. Activities & operation

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Know your employees

Know your product and services

Know your suppliers

Conduct background checking on suppliers

Review suppliers regularly

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Suppliers relationship Purchasing, asset requisition and disposal 3rdparty contract, outsourcing and co-outsourcing Delivery of goods Quotations, tender and bid placement Inventory and asset management Processing and negotiation Travel and advance claims of CPP staff Purchase during sales promotion Non budgeted, emergency/urgent purchase, non-

budgeted purchase

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Definition firm adherence to a code ofespecially moral or artistic values

Integrity

I. ConsistencyII. Honesty

III. Trustfulness

IV. Free of hypocrisyV. Accuracy

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Person integrity

Business integrity

Professional integrity

Product & service integrity

Record & data integrity

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Environment/culture

Strong internal control

Establish fraud management framework

Anonymous fraud reporting mechanism

respond

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Negative publicity

Not an EOC (Employer of choice)

No uniformity

Unhealthy business

Poor product/service

Fines