XYZ Limited wants to observe good governance practices. The company has approached you to suggest controls to prevent and detect frauds and to educate their employees towards the awareness of frauds. Give your recommenda

The following are the recommendations for the control and education to be applied in the entire organization: Segregation of duties: The duties of the executives need to be segregated and some single person should not control multiple aspects and processes of transactions as far as possible. Rotation of duties: It should be ensured that there is a periodical rotation of the duties for the key position. The job rotation must be made mandatory for which a policy should be framed by the company Mandatory rotation: There has to be a mandatory vacation policy to the key employees which will help them to come a fresh after the vacation and work more efficiently but will also help to prevent the employees to hide the trails of the crime if any. Treat employees well: The employees need to be motivated on the aspect of the treatment which they get at the hands of the management. The better treated employees reduce the chances of fraud and take revenge attitude. Regular audit: Internal audits especially in the remote locations and other significant projects must be carried out specifically apart from the regular audits. Background check: The background check of the employees particularly those who have been appointed on the positions of trust and responsibility must be carried out diligently Whistleblower hotline: Implement whistle blower policy and a hotline for the employees to blow the whistle provided adequate training on the frauds and the types of the fraud which normally happen and mechanism of reporting and eradication of frauds. Code of Conduct: Established code of conduct clearly giving the ethical behaviour and the expectations from the employees. Independence of independent directors: It must be ensured that the independent Directors are really independent and their regular review and they should approve the financial statements submitted by the management without pressure Management oversight: The management must hold the employees accountable for their actions and ensure that the consequences are enforced as and when they are necessary Document retention: Establish policies for the retention and destruction of the records so that important documents are not lost or destroyed.