It might look like your office area is fully installed with a heavy security system and, you have tight control over the security of your business; you and your business could still be the victim of fraud. Therefore, your business can be more helpless against any fraud and scam than you might suspect, regardless of whether you have security gauges set up. You should know about the hideous works going on in your office. Sometimes relying only on day-to-day business operations and bookkeeping duties is not enough; instead, keeping a close look at the warning signs that direct a business fraud.
What are the signs that might indicate fraud in your business?
Below are some of the significant and telltale signs listed indicating your business is indeed the victim of fraud.
Delegating all of the financial work to a single employee can be treacherous, which means putting your company at a much greater risk of fraud. Even if the employee is performing the duties well, giving too much access to a single employee regarding the payments, expenses, receiving of cash and, various other bookkeeping activities is never a good choice. Instead, assigning separate work to different employees is recommended to avoid any mishap from occurring.
Excessive transactions and having less oversight
It is always vital to keep a sharp eye on your bookkeeping records. In case there are various transactions made to clear mistakes, it very well may be done to conceal a fraud. Moreover, if there are several payments on a single bill, there might be a possibility that the employee is hiding the money for themselves. In such situations, where the employee is making; more transactions than needed, it is better to have more insight and audit their work.
Unbalanced Cash Accounts
Cash balances against your sales and expenses should always balance properly. Both too low and too high balances can be suspicious. Although having such balances can be an honest mistake, low balances can sometimes be a sign of missing money, and high balances can also indicate that an employee is trying to make up for the past fraud.
Such payments might happen because of blunder, oversight or, erroneously recording a seller receipt twice. However, duplicate installments are additionally a chance for a person to steal from the association. Looking at canceled checks and performing an audit of the duplicate payments can relieve the fear of fraud.
Refusing to leave the task to others
An employee who is consistent and devoted towards his work should always be appreciated; however, other than being an overachiever, if an employee wants to do everything on their own and never lets anybody else look at their work is a cause of concern. It simply means that he is maybe involved in fraudulent activities and trying to hide the scam from others.
Although product loss and waste are a common and regular part of business, excessive lessening and reduction of the inventory can be an obvious sign of theft. Apart from portable stock, dishonest insiders often sell large bulk items and raw materials.
How to handle the warning signs of fraud?
If you keep seeing the signs that might indicate fraud in your business, it’s better not to ignore the red flags. The sooner the symptoms mentioned above are identified and addressed, the better it is. Monitoring key pointers of any suspicious activity is the initial step to recognizing and stopping the fraud that might happen inside your organization. Approaching the suspicious employee in a non-confronting manner is always recommended. Building a good relationship with employees is vital but at the same time, keeping an eye on their activities is also essential to prevent any scam from taking place. Reach out for professional help. The securities fraud lawyer will help regain your losses and get you your money back from the scammers as soon as possible.
Even if you believe that your business isn’t a victim of fraud, it is better to take help and move to outsourced accounting services that will provide an additional layer of review that might help prevent any fraud in the future.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 platform where their QuickBooks™️ file, critical financial documents, and back-office tools are hosted in an efficient SSO 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.