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There are some typical signs that may indicate or warn of unethical practices. These include, but are not limited to the following:
- Deviations from correct procedures- the employees stop following organization procedures that were put in place.
- Overcharging by the supplier- The supplier intentional or unintentional decides to increase the price of items. This is likely to happen when an organization relies on centralization purchasing.
- Poor record keeping and missing files- this makes tracing of important documents to be difficult.
- Poor or no separation of duties- For example, the same person issues the order and approves the payment. Also only one person signs a contract.
- Poor relationship with the suppliers- that is excessive entertaining by suppliers, unnecessary meetings with suppliers.
- Resistance to audit
- Dictatorial management style
- Poor quality of materials purchased.
- Loss of government funds.
Tell-tale signs that something is amiss often fall into the following categories:
- Excessive secrecy. This can range from missing files and records to resistance to audits and reluctance to delegate or run competitive tenders.
- Suspect procedures. Normal procedures are ignored, or appropriate checks and balances are missing – for example, the same person approves an order and payment for that order, or only one person approves contracts.
- Inappropriate life or work styles. Buyers’ lifestyles may be out of keeping with their level in an organisation, they may have an unusually high number of meetings with a supplier, be entertained to an excessive level by that supply, or a combination of any of these.
