What is a common technique for detecting change order abuse?

A common technique for detecting change order abuse involves reviewing change orders that add new items. This method is effective because change orders that introduce new items can potentially indicate fraudulent activities or manipulation of the contract terms. By closely examining these orders, auditors and fraud examiners can identify patterns or discrepancies that suggest the addition of non-essential or inflated items, leading to unnecessary costs for the project.

By focusing on the specific additions in change orders, one can uncover whether contractors are taking advantage of the contractual flexibility to boost their payments illegitimately. This scrutiny can also highlight whether proper procedures were followed in justifying the need for these additional items. In many cases, change orders may be legitimate; however, the potential for abuse lies in the lack of transparency and oversight concerning increased expenditures that were not originally anticipated in the contract.

The other approaches, while they may have some relevance, do not address the primary concern of detecting potential abuse as effectively as examining change orders that add new items. For instance, decreasing contract costs might indicate a legitimate reduction in scope but wouldn't inherently suggest fraud, while focusing on contracts with no changes overlooks potentially problematic contracts entirely. Interviewing satisfied contractors may provide useful insights, but it does not directly align with uncovering indicators of fraud or abuse in the