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Effective corporate governance programs are crucial to deterring fraud, waste, and abuse.
Contractors that implement effective corporate governance programs tend to manage programs
more efficiently and remain in compliance with applicable laws and regulations. To
emphasize the importance of these programs, the SIGIR is pursuing a strategy of
integrating corporate governance assessments with many audits of contractors and
sub-contractors. Any high-risk issues the auditors identify during these reviews will
provide a basis for further review and action.
The most recent reporting period provides an example of this process in action. SIGIR auditors
are in the process of conducting a performance audit of a major construction project in northern
Iraq. The auditors observed and documented the contractor’s governance practices for a task order
under one contract. The auditors found evidence of a generally elevated level of attention to
internal controls issues, including established procedures for validating that controls are being
followed at the job site. Specifically, the auditors spot-checked a wide range of site policies
and procedures, including:
- safety
- subcontractor flow-down requirements
- documented assurance of compliance with statutory requirements
- work plan development consistency
As the pace of construction activities in Iraq increases, SIGIR auditors will continue to
integrate reviews of governance programs into audits.
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