A common one is misuse of contingency reserves to pay for scope increases. This often arises when the change control and financial approval process is very onerous.
Another is having team members bill their time based on what was budgeted rather than what was actually utilized. This happens in cases where a PM is measured based on how close to the original budget they are.
Senior Projects Manager | Field & Marten AssociatesNew Westminster, British Columbia, Canada
Kwiyuh
Kiron's feedback is very solid. I see those two common red flags very often in construction projects.
RK
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1 reply by Kwiyuh Michael Wepngong
Aug 10, 2021 5:24 AM
Kwiyuh Michael Wepngong
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Thanks for the confirmation RK
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Sergio Luis ConteHelping to create solutions for everyone| Worldwide based OrganizationsBuenos Aires, Argentina
Key here is what you consider as a "fraud". In fact, if you are inside a company, what matters is what the company consider as a fraud. A company will have a governance process in place to detect anything related to fraud using tools like AI to detect it. But at the end is up to each person who works in the project.
Sergio makes a good point. One thing I see as questionable is billing overhead to a client's project. The company may have rules such as if you are interrupted for less than 20 minutes, for something non-project related, that time still gets billed to the project. I might disagree with that since you can hide a lot of overhead as billable time that way, but it is still the rule and I'm not a legal expert.
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1 reply by Kwiyuh Michael Wepngong
Aug 10, 2021 5:28 AM
Kwiyuh Michael Wepngong
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Merci Keith, You've raised a sensitive HR-legal issue there
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Peter RapinSubject Matter Expect; Project Delivery| Independent ConsultantOntario, Canada
Fraud is taking or getting something that is not yours through devious means. I interpret fraud as a criminal action rather than mismanagement leading to wasted resources. Dictionary definition: - "wrongful or criminal deception intended to result in financial or personal gain".
When fraud is suspected within an organisation, which may be identified through audits and other governance processes, it can be investigated internally and, if not significant, resolved accordingly (at a senior level).
However when fraud is suspected of external parties - suppliers and such - as may be determined though contract reviews and billing analysis, then it invariably needs to involve external authorities (police). The problem may be much deeper than project impact.
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1 reply by Kwiyuh Michael Wepngong
Aug 10, 2021 5:29 AM
Kwiyuh Michael Wepngong
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Thanks Peter, your narrowing of the Fraud issue to internal & external is very interesting
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Marek RudnickiPMO, Program Management, Project Management, Business Development| FreelancerPoland
+ for Kirion answers.
I am always suspicious if the estimate for completion is not changing for months. Then one day the EAC is turning above your cost budget + risk buffer. Which makes risk buffer management completely obsolete.
Using more expensive resources than planned - just because they are on a bench but keeping the same cost rates. The list goes on.
But reporting pre-agreed time of resources is, for sure most popular.
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1 reply by Kwiyuh Michael Wepngong
Aug 10, 2021 5:30 AM
Kwiyuh Michael Wepngong
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Thanks Marek, interesting note about reporting the pre-agreed
In a former position I have seen costs allocated to a project before the physical items were allocated from inventory to the job (machinery-based project). This was a huge red flag for me and in retrospect it should not have happened that way, I should have been more affirmative in expressing my concerns that the costs should not be allocated until they items are moved to WIP.
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1 reply by Kwiyuh Michael Wepngong
Aug 10, 2021 5:32 AM
Kwiyuh Michael Wepngong
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Thanks Bob, quite curious to know how this went under the eyes on the internal control.... Your worries and concerns were very legitimate
Financial Management Specialist | US Peace CorpsYaounde, Centre, Cameroon
Aug 05, 2021 12:27 PM
Replying to Kiron Bondale
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Kwiyuh -
A common one is misuse of contingency reserves to pay for scope increases. This often arises when the change control and financial approval process is very onerous.
Another is having team members bill their time based on what was budgeted rather than what was actually utilized. This happens in cases where a PM is measured based on how close to the original budget they are.
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