Fictitious sales are created when an employee rings or enters a false sale into the companies accounting system or register. Many times fictitious revenues are created in Payroll Commission Schemes to increase the sales reps commission. The employer believes the sale to be legitimate and issues a commission check to the salesperson.
A few methods to prevent fictitious revenues is to verify all new clients or customers especially with large orders. Analyzing the companies accounts receivable aging often shows a pattern of slow paying or no paying customers. Many times narrowing it down to a specific salesperson.
