Internal controls not priority

Financial analysts, shareholders, management and other major stakeholder pay
too little attention to company internal controls, says a leading fraud expert,
warning that Societe General isn’t unique in its lax controls.

‘Too many leaders underestimate the risks of fraud to their organisations and
to the economy,’ Francis Hounnongandji, president of the French chapter of the
Association of Certified Fraud Examiners, writes today in the FT.

The solution, Hounnongadji said, ‘is better education and a stronger culture
of internal controls among board members, senior management and the financial
analysts who assess the value of companies’.

Part of the problem throughout the corporate world is that teams of internal
audit and control tend to comprise junior employees with little experience of
complex financial transactions, Hounnongandji added.

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