Signs And Solutions For Preventing Fraud

Preventing Fraud - Complete Controller

Many organizations and business owners face fraud each year due to their employees or business partners. New entrepreneurial start-ups and small businesses are more vulnerable. The risk of fraud has increased due to the advancement of technology and progressive development of the world into a global village.

The increased awareness of technological development and complex organizational structure requires corporations to incorporate internal anti-fraud approaches to combat fraud. According to 2014 research reports by the global nation, organizations face a 5 % loss due to fraud each year, in which internal employees committed 85% of serious fraud cases. Organizations should develop multi-layered fraud prevention strategies while keeping these statistics in view.

Following are the warning signs to detect fraud and stealing by an accountant. Check out America's Best Bookkeepers

Change in Habits and Behavior

A good manager should know their employees. They manage their time to have frequent conversations with each of them. Good managers are concerned and aware of any problems they are facing in their professional or personal lives. The basic information about your employee’s family, life, and habits will help detect any change in an employee’s habits.

The first sign that your accountant is stealing from you is a change in their habits. Suddenly becoming more proactive in your business, becoming disobedient towards you, or on the phone more frequently are all signs that could be a red flag. Also, if they are suddenly working during times that no supervisor is present, it’s important to keep an eye on their activities.  

Accountant in Bad Waters

Sometimes an accountant under financial stress can turn to fraud to fulfill their needs. The financial crisis could be from the following circumstances: 

Unexpected debt

Sudden debt faced by an accountant due to gambling, drinking, or divorce may be a reason for their fraudulent behavior. An accountant in financial strain may be a potential risk to your business. The financial burdens act as the trigger for theft. Check out America's Best Bookkeepers

Spending more than earning

If an accountant is spending more than they are earning, it could be a warning sign. Spending excessively on cars, shopping, homes, or taking loans all lead to financial strain, and they may think the only way out of this is by committing fraud.

Loose internal controls

A company’s loose internal controls are providing an opportunity for theft. Easy access to assets, checkbooks, or signed stamps lead the embezzler to find it easy to steal.

How to Prevent Fraud

Fraud deterrence is essential for all organizations. The bigger the organization, the more the chances of fraud increase. Fraud is as old as human history and can happen to any company or business despite the organizational structure and the number of workers. Small business managers tend to trust their workers more than bigger organizations.

There may be weak internal controls. Fraud affects the finances, image, and morale of the company. All factors decline after a fraudulent case takes place. Most organizations adopt shortcuts for fraud prevention. These tactics largely decrease the opportunity for fraud.

Internal controls

The internal controls of a system and organization define the plans to prevent the company and its assets from fraud and theft. This system should be revised frequently to analyze its effectiveness. It should be regularly updated according to the new needs, development, and advancements of a company. Internal controls should clearly define the accountability and compliance of its employees. Check out America's Best Bookkeepers

Documentation is an integral part of an internal control system and the most important tactic for fraud prevention. All procedures and transactions should be documented to minimize fraud. Every expense should be approved and countersigned by a managerial-level employee to ensure the validity of receipts and expenses. Restrict all physical and technical approaches to documents and information.

Segregation of duties

Clear segregation of duties is crucial for internal control. Distribution of bookkeeping and payments among two or more accountants or bookkeepers helps to prevent fraud.

Outsource accountant

One of the best ways to prevent fraud is to outsource accounting and bookkeeping functions to a third party.

Be systematic

Use accounting software to prevent fraud. QuickBooks handles all the key processes of accounting and prevents fraud. Assign limited rights to all employees according to their job descriptions and responsibilities. Don’t share passwords and logins.


Fraud in business can result in major financial loss, wastage of time, and a ruined reputation. The implementation of multilayered fraud risk strategies leads to a successful business protected from fraud and theft.


Check out America's Best Bookkeepers 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. Check out America's Best Bookkeepers