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#181213 - 04/19/04 08:44 PM Conflict of interest
Compliance99 Offline
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Compliance99
Joined: Jul 2003
Posts: 53
Washington
I have recently begun an audit of our deposit losses department, which handles overdrafts (among other things). I have several DDAs with my employer, and while I don't make it a habit to overdraw my account, it has been known to happen. Does anyone see any conflicts with my auditing of a department with which I might have contact as a consumer? Clearly there is the potential for conflict, particularly if I came under investigation for any sort of account abuse, but is that potential sufficient reason for me to either recuse myself from the audit or to be relieved of the duty? Aside from that, or closing all of my DDAs, I can't think of another alternative should the issue come to a head. Thanks for your thoughts!

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#181214 - 04/19/04 09:56 PM Re: Conflict of interest
Pale Rider Offline
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Pale Rider
Joined: Aug 2002
Posts: 34,318
under the Lone Star
Well, it seems to me you have voiced rather well the theory that auditors should not bank with their employer. This practice also puts the line staff in an awkward position, do they cut the auditor some slack and cover the overdrafts in the hope of an easy audit, or do they throw the book at the auditor that overdrafts an account so that it appears they show no favoritism ? There are some areas that are better off outsourced, perhaps this is one in your particular case.
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Societies that do not find work in and of itself "pleasing to God and requisite to Man," tend to be highly corrupt.


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#181215 - 04/19/04 10:31 PM Re: Conflict of interest
Compliance99 Offline
Member
Compliance99
Joined: Jul 2003
Posts: 53
Washington
One thing that is always adhered to in my institution is that fees, such as OD fees or NSF fees, are never waived for employees unless that employee's manager requests an exception. And I don't know about anyone else, but my personal finances are no business for my manager; I would rather pay the fees than open that can of worms. But you're right, the possibility of impropriety is present. Maybe I'll have to get a new account somewhere, since I can assure you that an institution of this size will not outsource its auditing of that area, at least based on the concerns of someone as far down the foodchain as I am. Thanks for your thoughts. Any other are appreciated.

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