Don’t Let Your Money Disappear!

 ANYONE  Longstanding  All levels  No prior history

87% who commit fraud have never been charged before

Frauds last 18 months before they are detected

Average loss $60K from employees, $180K from management

Tip offs in 81% of cases Financial stress Control freak Too close to vendors Living beyond means

Small organizations = more frauds for more money

The longer they’ve worked The larger the fraud

Audits find only 3% of the fraud

INCENTIVE OPPORTUNIT Y RATIONALIZATION

 Medical  Spouse unemployment  Gambling  Debt

 Just borrowing  They owe me  They’ll never miss it

 No one watching  Too much control  Cash  Management override

YOU CONTROL THE OPPORTUNITIES

 MANAGEMENT must create the control environment  Auditors simply evaluate

 Rules apply to all  Don’t belittle procedures  No management overrides  Discipline

 Tipline  Employees and the public  Training

InitiateApproveComplete SEGREGATION OF DUTIES

BARRIERS  Small staff  Signature stamp, on-behalf approvals SOLUTIONS  Involve other employees, may not be finance staff  Approver must sign

 Require receipts  Involve multiple people  Reduce cash when possible

 Don’t pre-sign  Don’t use stamps  Independent review  Void check procedure

 W-9  Already in system?  No phone = red flag  Verify the business

 Original invoice/receipt  Analytics – ex: fuel  Credit card controls

 Best Practices Website  Your Questions