As it pertains to fraud, the old adage about a touch of prevention being worth a large amount of treatment is spot on.
Investing in fraud prevention processes can be more cost effective than spending money and time on cleanup after a fraud was detected. Here are ideas to help prevent fraud in two crucial areas:
Payroll Services: If your business uses payroll software, set the control attributes that were internal up to retain master hourly rates, hours worked, and bank direct deposit advice safe. (Ghost employees are workers who don’t really work for your business, such as former employees who continue to receive paychecks.) Monitor your expense accounts and financial statements.
Accounts payable: Create an incredibly clear segregation of duties between the employees who receive goods or authorize services, and the employees who process the payments for those goods and services. Having more than one individual finish a job makes fraud more difficult. Take time to get to know your vendors. You desire to be sure the companies you are paying are real, not fictitious things. Tracking the amount of invoices you receive from vendors that are individual, along with the average payment amounts for particular sellers, can alert you to questionable payments.
An additional suggestion: Communicating in what isn’t appropriate behaviour and is is also a prevention method. Stress to your clients, your vendors, and your employees that unethical behaviour and practices are not acceptable, and clearly state the results.
Whatever the size of your business, fraud can affect your bottom line. If you have questions about implementing fraud prevention strategies, please contact your accountant. They have suggestions and hints that can help keep your company assets safe.
