Home working has reduced the risk of payroll fraud

Remote working has had the added benefit of reducing the risk of fraud, a fire brigade audit report says.

Shropshire and Wrekin Fire and Rescue Authority is due to hear that payroll is the department “most at risk of fraud, due to its size and nature”, but electronic payment authorisation has mitigated that concern.

In the document, prepared by external auditors Grant Thornton, authority managers add that there are no allegations or irregularities currently under investigation and the general risk is low.

The audit risk assessment will be discussed by the authority’s Standards, Audit and Performance Committee next week.

In a question-and-answer section of the report, Grant Thornton representatives ask: “Has Shropshire and Wrekin Fire and Rescue Authority assessed the risk of material misstatement in the financial statement due to fraud?”

The report quotes the authority as answering: “Although there is an ongoing risk of fraud being committed against the authority, arrangements are in place to both prevent and detect fraud.

“The risk of material misstatement of the accounts due to undetected fraud is low.”

Grant Thornton then ask which classes of its accounts, transaction and disclosures it deems “most at risk to fraud”.

“Payroll is the area deemed to be most at risk of fraud due to its size and nature,” managers reply.

“However, electronic on-call firefighter payments were introduced in 2019-20, and remote working has necessitated the introduction of more electronic claims and authorisation which has mitigated further the risk of fraud.”

The report adds that the authority is not aware of any “actual, suspected or alleged fraud, errors or other irregularities” since April 1, 2020, and its Anti-Fraud, Bribery and Corruption Strategy is circulated throughout the workforce.

Shropshire and Wrekin Fire and Rescue Authority’s Standards, Audit and Performance Committee will discuss the report when it meets remotely on Thursday, April 22.