Archive for November, 2011
Is Embezzlement in your Future?
Posted by Kim Perkins on November 22nd, 2011
Loss Prevention 101
Recently, Green Apple Resources acquired a client who had discovered embezzlement within his company. Embezzlement, unfortunately, is widespread and is very difficult to detect. It is also a crime of opportunity and trust.
After reconciling the books and rectifying a situation which neared financial ruin for the client, Green Apple Resources examined how the crime occurred, and what could the client have done to prevent the theft from happening in the first place.
The best way to prevent embezzlement is to be an honest business owner. Your integrity leads by example to your employees. Second, pay your employees fairly and treat them well. Third, hire the right employee. Start by checking all references. Consider obtaining a fidelity bond on the new hire. If the employee is not bondable, don’t put them in a position of handling your financial matters.
Here are some simple steps to take which may save you from embezzlement:
- Assign designated duties to more than one person. Don’t have one person responsible for making deposits, reconciling bank statements, or controlling the petty cash account.
- Review your bank statements. It’s your money, review the copies of the checks. Is that your signature on each check?
- Establish office routines which act as a safeguard for your money. Make deposits daily, close and balance daily, bill as your services are rendered, have checks printed and attached to invoices. Do not sign a check if the recipient is in question.
- Above all, be an example for your employees. Do not teach your staff that it is okay to use office supplies for personal business.
In the case of our client, a stack of checks from the middle of the pile was taken and used by the girlfriend of an employee. Losses totaled over $5000.00. After reconciling the books and recommending procedures to curtail future thefts, Green Apple Resources left the outcome of the crime up to the client. In this particular case the client refused to prosecute.
If you detect missing documents, delayed bank reports, holes in your accounting records, a disappearance of petty cash funds, huge profits reported but no money in the bank, or other indicators that something isn’t quite right with your books, call Green Apple Resources!
Remember, your success is our business, and…
We want to be… At The Core!
