Employee fraud or theft is a severe organizational issue impacting American businesses of all sizes, in all sectors. Gone are those days when the magnitude of theft used to be minimal, and companies could recover their losses and get back on track at the same pace. Now, recovering from financial injuries, especially when companies have lost their market share, is extremely tough. The impact of employee fraud yields devastating results as it hurts companies financially and culturally—it also causes lasting reputational damage that is hard to recover. So, companies devise effective fraud prevention, detection and response plan, and strategies to keep the company going in the right positive direction.
You Should Always Track Your Employees—Even If They Are Highly Entrusted Ones!
On the other hand, companies need to get out of an illusion that their entrusted employees are loyal. According to a recent study concluded by a group of Harvard students, your trusted employees are more likely to steal from you than your new hires. Moreover, it revealed that 80% of employees in a typical organization are likely to steal from you, given the right circumstances. This revelation indicates that companies need to monitor and track their employees’ habits, changing attitudes, and evaluate employees’ commitment to job roles to expect to reduce specific organizational threats related to employee fraud. There are tools and techniques that owners can integrate into their organizations to know who is stealing and who intends to take from you.
Hire A Professional Manager, If You Lack Risk Management Skills!
As a business owner, you must create transparent processes so that your employees are aware of repercussions before committing fraudulent activities. If the employers in your company can’t do it by themselves, then they can hire the expertise of professionals who could investigate the loopholes in the company and recommend possible tools and techniques for fraud prevention. Fraud or crime investigators have superior knowledge and know the art of turning things around for the company. The recommendations can prove fruitful and in a possible recovery of the company.
Effective Internal Control!
So, it’s all about maintaining adequate internal control. If you can control your employees, you can witness significant results in more excellent reputational value and higher financial returns. Although your employees are your real assets who have the potential to turn things around for the company, so if you can control your employees, then you can control the success of your company. For fraud prevention and detection, you can use fraud detection software, bookkeeping and accounting software, install CCTV cameras, and much more. Furthermore, you need to evaluate and notice your employees’ behavioral changes and spending habits.
Prevention of fraud–analysis
Businesses can’t survive in the market for long if their financial statements and cash flow are negative. This negative cash flow results in the company’s demise and business becoming a part of history. For fraud prevention, you need to improve your internal controls by implementing continuous auditing and monitoring. This auditing indicates that accurate financial tracking can produce the right results, and businesses need to make their fraud prevention intentions right for yielding positive future returns for the company.
Fraud–Once Detected, Then What?
Once the perpetrators get caught and have physical evidence of fraud, you need to generate the right response or effective treatment for setting up an example for your entire organization. The culprits could be handed over to the police, pursued in court, and treated as per your company’s rules and policies. No matter what, you should never ignore employee fraud, as you may never find yet another chance to catch the culprit. According to a study, fraud prevention is possible only if a company has a habit of generating a positive yet quick response to employee theft. Trust me! This issue should never go unattended and must be resolved and handled rightly.
The primary purpose of launching a business is to earn a profit, and if there are disruptions in monthly profits due to employee fraud, you cannot expect to achieve your business goals and objectives at large. Fraud prevention is not that tough; all you need to do is hire the right practices and exert full internal control to ensure success.About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity.