This Is Auburn OFFICE OF AUDIT, COMPLIANCE & PRIVACY
Office of Audit, Compliance & Privacy

Our Mission

The mission of the Office of Audit, Compliance & Privacy is to assist the University in fulfilling its vision of being a preeminent comprehensive land-grant university. Our office provides services in three distinct yet related disciplines - audit, compliance, and privacy - in support of Auburn University's three-pronged mission of teaching, research, and service.

The Office of Audit, Compliance & Privacy functions in partnership with University leadership to:

  • improve the internal control system and culture;
  • improve and enhance the management of operational, financial, compliance, strategic and reputational risks;
  • enhance governance processes;
  • ensure strong stewardship and management accountability at all levels of the University.

Case In Point: Lessons for the proactive manager
Volume 10: No 03

In this month's Case in Point: Lessons for the Proactive Manager, we continue our review of the events of 2017 with a focus on the Fraud & Ethics category. I speak on this topic regularly and also teach ''Fraud Examination'' in the Masters of Accountancy Program here at Auburn University's Raymond J. Harbert College of Business.

Here is the breakdown of stories in the Fraud & Ethics category in 2017:

  • Occupational Fraud 39%
  • Use of Funds 27%
  • Non-occupational Fraud 18%
  • Academic Fraud 10%
  • Research Fraud 6%

Many people are surprised to learn that education as an industry is actually a frequent victim of fraud. The most common type of fraud we see in education can be termed ''occupational fraud,'' which simply means an employee steals or misappropriates from their employer. The best way to prevent occupational fraud is by having good internal controls. In my view the two most important components of internal control are: (1) ensuring one person doesn't have complete control of a process and (2) management adequately fulfilling their oversight role. Too often, the lack of simple oversight allows occupational fraud to occur. If you manage money, people, contracts, accounts, or just about anything else, paying attention to what is going on is part of the oversight deal.

The category we termed ''use of funds'' refers to stories in which institutions were questioned over how funds were spent rather than fraud per se. We are stewards of funds from a variety of sources—including taxpayers. With stewardship comes the responsibility to ensure we are making wise decisions in how we use institutional funds. With increased transparency in today's social media world, if anything, this category will only grow in importance.

The non-occupational frauds were those committed by individuals outside the institution. We saw numerous institutions across higher education get hit by vendor imposter frauds over the past year. In these schemes the fraudster poses as a legitimate vendor and asks for a change to the vendor bank account. If this scheme works, the next payment to the vendor is received by the fraudster rather than the legitimate vendor. Essentially, this scheme is a targeted form of phishing.

Ensuring we maintain vigilance in protecting institutional resources is very important. It is also just one of the many things we must think about when we consider the wide variety of risks we face in higher education. We again invite you to review the events occurring across our industry over the prior month, and, as always, we welcome your comments and feedback.

(Read more of Case In Point)

Anonymous Reporting Hotline

Auburn University uses the EthicsPoint anonymous Reporting System to enhance communication and empower individuals to promote safety, security, and ethical behavior. Use this anonymous, confidential system to report situations, events or actions by individuals or groups that you believe unethical or otherwise inappropriate. Frivolous or unfounded reports do not help foster a positive workplace. This hotline service does not replace our existing reporting methods for reporting fraud, waste, abuse or other potentially illegal activities. The University continues to encourage stakeholders to report concerns or suspected violations to their supervisor or other campus entities as appropriate. If you are uncertain if a situation violates University policy, is illegal or constitutes harassment or discrimination, you may use EthicsPoint to obtain clarification. We would much rather have you ask questions than let potential problems go unchecked. However, EthicsPoint should not be used for immediate threats to life or property. If the situation presents an immediate threat to life or property call emergency -- 911

Last Updated: October 31, 2016