Is Fraud Occurring In Your Company

By: Bs&p  09-12-2011

Employees committing fraud often display certain behaviors or characteristics that may serve as warning signs.  Some examples include:

  • Living beyond means
  • Financial difficulties
  • Family or personal problems
  • Refusal to take vacations
  • Wheeler dealer attitude
  • Unusually close attention with vendor / customer
  • Control issues; unwillingness to share duties

The presence of one or more of these characteristics does not necessarily mean that fraud is actually occurring; however, management should explore the possibility that fraud exists.  The following is a list of the most frequent types of fraud that occur in small companies:

  • Check tampering
  • Fraudulent billing
  • Skimming
  • Cash larceny
  • Expense reimbursements
  • Payroll schemes

Can you afford to lose 7% of your revenues?  It is estimated that fraud annually runs about 7% of gross revenues of all businesses.  In this country alone, that adds up to over $900 billion annually.

Now is the time to take a closer look at your company's policies, procedures and internal controls to see where improvements can be made to reduce your risk of fraud. 

The information in this article was current at 06 Dec 2011

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