India among top 3 regions in corruption-linked fraud
An overwhelming 80 per cent of companies polled in India said they had been victims of fraud in 2015-16, up from 69 per cent in 2013-14, according to a survey report.
The Global Fraud Report 2015-16 by risk mitigation consultancy Kroll, with the aid of the Economist Intelligence Unit, found that the perceived prevalence of fraud in India is the third-highest among all countries and regions surveyed across six continents. Only Colombia (83 per cent) and Sub-Saharan Africa (84 per cent) surpass India.
The report’s authors observed that while the incidence of fraud was on the rise globally, a combination of a lack of preventive measures at Indian companies and a poor legal system had resulted in 92 per cent of the respondents saying they had witnessed an increase in exposure to fraud.
The India-centric data in the report shows that the highest incidence of fraud as reported by Indian companies is due to what the report terms ‘corruption and bribery’.
A quarter of the respondents said they registered losses due to this. On average, the worldwide survey found that only 11 per cent of the companies reported corruption and bribery as a source of revenue loss.
The second-highest fraud-related source of loss of revenue in India is vendor, supplier or procurement fraud, which affected 23 per cent of the companies, which is also higher than the global average of 17 per cent.
Interestingly, the 2013-14 survey found that the highest source of fraud-related revenue loss for Indian companies came from theft of physical assets or stock (33 per cent) and both information theft, loss or attack and corruption and bribery were on a par (24 per cent). High turnover
The latest report also finds that the biggest factors exposing Indian companies to fraud have changed over the last few years. Where the previous report pegged IT complexity as the biggest contributor to fraud, the 2015-16 report says the new drivers of fraud are high employee turnover and cost restraints over pay. For respondents that had identified the perpetrator, 59 per cent indicated that junior employees were leading players in at least one such crime. Despite these vulnerabilities and the high proportion of fraud perpetrated by insiders, only 28 per cent of companies in India invest in staff background screening and only 55 per cent invest in vendor due diligence.
Compounding the problem of inadequate preventive measures is the issue of what happens once fraud has been detected. Often, the legal system in India is not quick enough to make it worth the company’s while to go to court, the report’s authors said.
First, the bar is set high for what constitutes evidence of fraud in a court of law in India; second, once in court, it can take years to settle disputes, by which time the value of the investment may have significantly eroded. These factors explain why PE (private equity) investors are usually not keen to go to court immediately following a dispute.
Quality Council of India
Quality Council of India (QCI) was set up jointly by the Government of India and the Indian Industry represented by the three premier industry associations i.e. Associated Chambers of Commerce and Industry of India (ASSOCHAM), Confederation of Indian Industry (CII) and Federation of Indian Chambers of Commerce and Industry (FICCI), to establish and operate national accreditation structure and promote quality through National Quality Campaign. QCI is registered as a non-profit society with its own Memorandum of Association. QCI is governed by a Council of 38 members with equal representations of government, industry and consumers. Chairman of QCI is appointed by the Prime Minister on recommendation of the industry to the government.
The Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, is the nodal ministry for QCI.
It functions through the executive boards in the specific areas i.e. Accreditation for
Conformity Assessment Bodies,
Healthcare Establishments
Education & Vocational Training Providers.
In addition it has an exclusive Board for promotion of Quality.
Airlines can now import older planes
Domestic airlines can now import aircraft that are up to 18 years old into the country with the government amending more than two-decade rules in this regard. The move is expected to provide a fillip for the government’s ambitious efforts to boost regional air connectivity as it gives more leeway for operators in expanding their fleet. Till now, aircraft that are more than 15 years old were not allowed to be imported.
As part of larger efforts to improve the ease of doing business in the domestic aviation sector, which has huge growth potential, the Directorate General of Civil Aviation (DGCA) has made changes to rules that had come into effect way back in July 1993. With the revised norms, pressurised aircraft that are not over 18 years old or those which have not completed 50 per cent of design economic pressurisation cycle can be imported.
A pressurised aircraft is one which is equipped to handle cabin pressure at an altitude of above 10,000 feet. Such planes should not have completed “15 years of age or 75 per cent of design economic life or 45,000 pressurisation cycle.
The regulations would be applicable for entities having scheduled, non-scheduled and general aviation operations.
In this regard, changes have been made in the relevant norms or Civil Aviation Requirements (CAR) effective from June 17. Aircraft intended to be imported for air cargo operations shall not have completed 25 years in age or 75 per cent of its design economic cycles or 45,000 landing cycles.
The regulator also said that studies were conducted by international aviation community on the correlation between fatal accidents and age of the aircraft.
With respect to unpressurised aircraft, the decision would be taken on a case to case basis after examining the record of the plane that is to be procured from overseas. Aircraft intended to be imported and used for scheduled commercial operations should have their design economic calendar and operational life clearly established by the holder of type certificate, among other requirements. Aircraft manufacturers usually prescribe design standards.