5 Tips for Keeping Your Business Financially Sound and Protected from Harm

Fraud, deceit, and theft are a growing problem among small business owners, and it is something that is causing an enormous loss of money. The Association of Certified Fraud Examiners estimates that businesses lose around $155,000 a year due to some type of fraud. The alarming thing about these incidents is that this fraud is coming from inside of the business, done by employees that are often trusted by employers. Some employees entrusted with handling business accounts are stealing right under the owner’s nose. The perpetrators are usually never suspected because there is a lack of preventative security protocols that can help to not only catch perpetrators, but also eliminate the temptation to commit embezzlement and fraud. In order to protect your business from being victimized, follow some of the tips on a website https://bumber.info/ that are recommended by Oceanside defense lawyer, Bradley Corbett.

Be Smart with Cash

Leaving ample amounts of cash in areas where employees have easy access makes it tempting for employees to steal. Even if the cash is put in a lock box, or some sort of container, these things more than likely will not be secure during business hours, and employees with keys will be able to have easy access to the cash that is inside. Sneaky employees are good at slipping out a few bills and stashing them away without ever being seen. Cash should be placed inside of a locked safe or moneybox that can only be opened by designated people. While advanced cash handling systems can sometimes be expensive, they will end up saving you a great deal of money and time

Do Daily Deposits

Transfer cash and checks to the bank on a daily basis. It is important that you stick with some sort of deposit schedule and that you record all of your different transactions. At the end of the day, make a record of all the money that you made and make sure that everything adds up. If something doesn’t fit right, then you will know that one of your employees stole the money or made a mistake. When you are depositing cash, only deposit the money that you made that day, leaving a small amount so that you can make change for customers that decide to pay with larger bills.

Limit Access to Business Spending

Only the most trusted employees should be allowed to issue business checks. Be cautious when deciding who has signature authority to sign checks. Checks should always be hand signed in pen ink, and a record of the check and the associated expense should be recorded in a central location. Put a limit on who receives a business credit or check card. It is unwise to simply issue a business card to several different employees, simply giving it to whoever is in need. Instead, make sure that every employee who needs a card has their own that is in their name. This way, you will be able to keep a detailed record of all the purchases that they make for the business, helping to prevent them from using the card for their own personal use.

Establish Checks and Balances

A main reason that dishonest employees find it so easy to steal from their employer is because there is no one else watching. Usually, the employee is given free reign to handle monies without being accountable for every dollar. This is especially risky if the employee also does the accounting books. They can easily change the numbers to leave out the amount stolen. Thus, give two or more employees money handling responsibilities. Divide tasks like cash receivables, check payments, signing checks, bookkeeping, and bank deposits between different employees and make them report even the smallest of discrepancies. Preferably, you should then quickly go over the money yourself, making sure that everything is accounted for and that your employees are being honest.

Get Employee Dishonesty Insurance

Obtain employee crime insurance coverage that protects the business in cases of employee embezzlement. This is normally a stand alone policy that is not included with other types of insurance. While this form of insurance will be an additional expense for your business, it can help to keep your company financially sound, even in the event of a large embezzlement or other fiasco.

Businesses must set up appropriate security measures to protect from becoming an easy target for embezzlement and fraud. Even if you know and trust your employees, this is not an excuse to give them free access to the finances of the business. Always treat your employees with respect by having them account for all of the transactions they process and items they purchase. Putting a system of accountability, along with certain safety measures, will help to keep your employees out of trouble, while also keeping your business profitable.