Your Small Business Organization Could Be Leading to Fraud
Did you know you could be giving your employees the opportunity to commit fraud, without even realizing it? Opportunity is a key piece of the Fraud Triangle, with the other two pieces being Motivation and Rationalization. Reducing the opportunity can be a daunting task, but fortunately a business management consultant is there to help you with every step.
Employee Oversight is Key
First, never leave an employee alone without any oversight. This system is called the checks and balances system, the same one used by the government to prevent corruption. It means you should always have more than one person checking the bookkeeping figures and counting cash drawers, for example. Leaving one person in charge means they have an opportunity to change things without anyone finding out.
Split the Responsibility of a Process
Second, never leave a single employee in charge of an entire process. This means, for instance, that the employee in charge of counting sales receipts should not be the same employee in charge of reconciling receipts with cash flows. There is too much opportunity there for fraud, and no one is likely to catch it in time.
Assign Tasks to More Than One Employee
Third, share responsibilities. If there is more than one person in charge of a task, there is less opportunity for fraud because employees would have to work together to commit the crime. Working together to commit fraud is known as collusion, and is relatively rare.
Save yourself a headache and prevent fraud before it happens!
Taking these preventative measures greatly reduces opportunity and is well worth your time and effort. If this gets you a little lost, not to worry: A business management consultant can help you put together a perfect fraud-prevention plan that will keep your company’s assets safe.
~by Cate Patricolo, Staff Writer, SEO, Keyword, Web Content Development, and Social Media Specialist, Fisher Business Management
