11. How does FCS deal with Addressing Fraud and Associated risks within grantees?

Continued control mechanisms are in place which includes capacity building the experience indicates a great improvement in terms of compliance especially by grassroots CSOs including very nascent CSOs in the recent past. While there are many risks associated with grantmaking, financial management risks are more serious because they also cost FCS resources.

Therefore the following will be common procedures to be followed during implementation and after audit:-

  1. As a preventive measure FCS shall conduct capacity development training to grantees in order to raise up their level of understanding issues of concern like:
    • Reporting of activities undertaken
    • Meaning and importance of having a sound internal control system
    • Segregation of duties and responsibilities
    • Record keeping and organized documentation and filing systems
    • Authorization controls
    • Bank reconciliation and cash management
    • Checking compliance with the other regulatory procedures and policies
  1. From time to time FCS shall make regular and on-spot checks to grantees to ensure compliance
  1. Where documents are missing FCS shall request that the grantee furnishes to FCS those documents within 30 days after the end of the audit.
  2. Where procurement processes are not demonstrable enough, FCS shall request for the evidencing documentation like quotations, minutes of procurement meetings, compliance to the agreed cause of action as seen from the minutes and any other observable items
  3. Where there is no convincing evidence of a transactional event, FCS shall require that the questioned expenditure be unrecognized and the money returned to FCS coffers thereby reducing the level of reported expenditure.

As for cases where fraud is suspected, FCS will require that confirmed amount of money be refunded and report these matters to the state organs like Prevention and Combating Corruption Bureau (PCCB) or Police who are authoritatively and legally mandated to address criminal cases.