An internal auditor performed a review that focused on the organization’s process for vetting vendors.

The organization is exposed to significant fraud and abuse risks as a result of the vendor and employee business relationships.

Due to improper relationships and favoritism, vendors are not providing goods or services at a reasonable price to meet the objectives.

The organization’s conflict-of-interest policies are not clear or well communicated throughout the organization.

Improper relationships and favoritism means that controls are not effective and significant fraud occurs.