Can your business afford the average loss of $155,000 for the fraud and another average of $15,000 for an investigation before lawyers are even involved?
A Fraud Prevention System is key to keeping the deterrence of financial crimes at a minimum. Businesses can suffer an average loss of 5% of their revenue to fraud without them even knowing it.
To make sure your business is taking all necessary precautions to deter fraud, we offer a fraud prevention service to many of our clients. This service is either a monthly, bi-monthly or semi-annual review of your accounting records and financial reports. Whether they are prepared by your in-house accounting employees or a contracted bookkeeping service, we review your customers, invoices, vendors, payroll, banking, inventory, credit card and financial reports. If you have a one person office who handles all of your accounting and bookkeeping, you are in a huge risk of fraud. Your employees may be the neatest people in the word, and you trust them with your life, but even the most unsuspecting fraudsters are stealing from you right under your nose.
Fraud prevention can be accomplished with the right internal control system put into place.
Please Contact Us today to schedule a free consultation.
Are you not getting your financial reports on time? Do your margins look off? Are you having cash flow problems and wondering where your money is going? We all know the economy is tough right now, and if your sales have dropped drastically and you understand where the cash flow is coming from, you are one step ahead.
Simple internal-control practices to lower your fraud risks
Segregate bookkeeping duties to more than one employee
If one employee handles 100% of the bookkeeping, review their work
Request Bank Statements delivered to the owner un-opened
Review all canceled checks for payee and endorsement accuracy
Review inventory valuations with physical counts on a regular basis
Review new vendors and make sure they are on an approved vendors list
Review purchase orders
Review new customers to make sure they really exist
Review accounts receivable aging reports to assure timely payment of invoices
Require supervisor approval for customer credit and charge backs
Check for related names and personal information such as mailing addresses between your employee list, customer list and vendor list.
Spot check payroll time cards with payroll reports
Distribute payroll checks by an employee who is segregated from payroll functions.
Review expense reimbursement reports with actual expense receipts - original receipts should be requested to receive reimbursements and approved by a supervisor.
Do not leave company checks or financial records out in un-locked filing cabinets or on storage shelves
Destroy all un-used checks
Enable job rotation
Enforcement of mandatory vacations
Surprise Audits where possible
Create a pro-active fraud prevention program in the work place
Dishonest Employees
Unfortunately your employees are 15 times more likely to steal from you than your customers. A strong deterrent for dishonest employees is knowing exactly what the ramifications of their actions will be. Employees need to know that if anyone steels or violates company policy at any level, they will receive a fair hearing, however swift, consistent and serious sanctions will be imposed such as termination, criminal prosecution and possibly civil action
Other Common Scams
Bogus Yellow page bills
Phony Invoices
Solicitations as invoices that are created look like actual invoices for goods or services such as "Non-compliance for your Corporate Minutes"
Phony ad solicitations
Slamming phone scam where the phone service is changed from one provider to the next without approval or consent of the company
Nigerian 419 are investment scam e-mails for advanced fee fraud demanding funds up front for a large sum of money that will never arrive
Transfer of money from Over-Invoiced contracts by transferring money into an overseas bank account owned by a foreign company.
