By one estimate, 30% of aerospace and defense industry companies have suffered some kind of fraud, with consequences that go beyond financial misstatements."A fraud can devastate a company's most valuable assets of reputation and brand value, even when there is no financial statement impact," says Scott Thompson, U.S. defense and aerospace leader at PricewaterhouseCoopers, a management advisory services firm.
Fraud in the aerospace and defense industry can range from improper payments to government officials to violations of U.S. Export Administration regulations.
PwC suggests companies adopt a five-step anti-fraud program that includes conducting a fraud risk assessment and standardizing processes for incident investigation and remediation.
