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DATA MINING DEPT OF EDUCATION & TRAINING PRESENTATION BY LEN STAFFORD MANAGER MANAGEMENT AUDIT

DATA MINING DEPT OF EDUCATION & TRAINING PRESENTATION BY LEN STAFFORD MANAGER MANAGEMENT AUDIT. DET CONSISTS OF SCHOOL EDUCATION TAFE NSW VETAB. BUDGET 2005/06 - $9.6 BILLION $6.6 BILLION – EMPLOYEE EXPENSES $1.5 BILLION – OTHER EXPENSES $1 BILLION – GRANTS & SUBSIDIES

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DATA MINING DEPT OF EDUCATION & TRAINING PRESENTATION BY LEN STAFFORD MANAGER MANAGEMENT AUDIT

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  1. DATA MINING DEPT OF EDUCATION & TRAINING PRESENTATION BY LEN STAFFORD MANAGER MANAGEMENT AUDIT

  2. DET CONSISTS OF SCHOOL EDUCATION TAFE NSW VETAB

  3. BUDGET 2005/06 - $9.6 BILLION $6.6 BILLION – EMPLOYEE EXPENSES $1.5 BILLION – OTHER EXPENSES $1 BILLION – GRANTS & SUBSIDIES $293 MILLION – DEPRECIATION $237 MILLION – MAINTENANCE

  4. PERMANENT PAYROLL 66,000 TEACHERS 3,000 STATE OFFICE EMPLOYEES CASUAL PAYROLL 26,000 CLAIMS WEEKLY NOW COMPUTER BASED

  5. AUDIT APPROACH CONTINUOUS PAYROLL AUDITS HR LEAVE DATABASES ACCOUNTS PAYABLE REGULAR SCHOOL AUDITS PREVIOUSLY EVERY 2 YEARS NOW MORE FOCUSED

  6. WHY GO TO DATA MINING?

  7. WHICH PRODUCT DID WE CHOOSE?

  8. WHY NETMAP ANALYTICS?

  9. WHAT PROCESS DID WE • FOLLOW WITH NETMAP? • FRAUD RISK ASSESSMENT • DEVELOPMENT OF SCENARIOS

  10. SOME FRAUD RISKS IDENTIFIED? CLERK PAYS FICTITIOUS EMPLOYEE OR VENDOR (4.1, 4.2, 4.3, 4.4 & 4.11) PAYMENT TO NON-EXISTENT ADDRESS PAYING OVERTIME / HDA / TRAVEL EXPENSES WHILST ON LEAVE

  11. RESURRECT FORMER EMPLOYEE (4.5.1 & 4.5.2) MISUSE SUPER USER OR CHANGE CONTROL ACCESS (4.16) CREATE PAYROLL GHOST (4.1, 4.2, 4.10, 4.12, 4.13, 4.14 & 4.15) RELATIONSHIP BETWEEN OFFICER & EXTERNAL PARTY (4.14)

  12. SOME SCENARIOS: 4.5.2 PAYROLL USERS LINKED TO EX EMPLOYEES WITH BANK ACCOUNT CHANGES 4.6 EMPLOYEES RECEIVING LARGE PAYMENTS ($20K+) 4.10 STAFF NOT ON PAYROLL BUT RECEIVING PAYMENTS

  13. 4.11 MULTIPLE JDE VENDORS AT SAME ADDRESS (EACH $20K+) 4.14 ADDRESS LINKED TO EMPLOYEE & VENDOR 4.16 STAFF WITH HIGH CONNECTIVITY

  14. FINDINGS TO DATE • MAINLY COMPLIANCE ISSUES: • ►CREDIT CARDS FOR FLIGHTS NOT UNDER GOVT CONTRACT • ► POOR ALLOWANCES MGMT • ► GST REQs NOT FOLLOWED • ► ACCTS PAYABLE MGMT • ► OVERPAYMENTS • ► CONFLICTS OF INTEREST • NETMAP HASN’T FOUND A FRAUD

  15. IMPORTANT LESSONS • MUST UNDERSTAND BUSINESS & SYSTEMS & RISK • RISKS ENABLE DEVELOPMENT OF SCENARIOS & IDENTIFY DATA NEEDS • NEED TO REVIEW FINDINGS

  16. CONTINUE BRAINSTORMING • ISSUES RAISED NOT TRADITIONAL. HOW DID WE COME ACROSS ISSUES? • DATA MINING IS ONLY ONE TOOL

  17. QUESTIONS?

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