White Paper - Conflicts of Interest Validation

Whitepaper

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Author

Peter McLeod

PhD, MInf, BAcc, BBus, GradCertIA, FCPA, PMIIA, MAICD

Date

2024

Topics Explored

Internal Audit, Ethics and Culture

Format

White Paper

Extract/Description

The issue to be addressed in this White Paper is ‘How can conflict of interest be validated?’

Key Points

1. Controls associated with conflict of interest are generally soft controls. While there may be a ‘hard’ element to a control such as a policy document or a signed employee declaration declaring they do not have a conflict of interest, there is no ‘hard’ evidence to confirm this – it is a self-declaration. It is virtually impossible to ascertain through audit or investigative methods whether a self-declaration is accurate.

2. This exposes the weakness of conflict of interest policy and associated controls – they are ineffective from an assurance perspective.

Relevant Industries

All

Level of Assumed Knowledge

Intermediate

Aligned to Global Internal Audit Standards

Yes