Conflict of interest — sales

An employee with a hidden interest in a customer sells to it below normal price, grants excessive discounts, credits, or refunds, writes off its balances, or extends unusual credit terms.

Partly covered. The remaining analysis is planned.

Starter pack: Revenue and receivables review

Red flags

In the data

• Customer matches an employee on address, phone, email, or bank account
• Customer credit balances and refunds to a small set of customers
• Discounts and allowances by rep far above peers

Behavioral

• Employee insists on handling the account personally
• Employee resists pricing or credit reviews of the account

Internal controls

• Pricing exceptions not approved independently
• Credit memos and refunds approved by the account owner