1. Chapter 4: Cash Larceny

2. Cash Larceny
Larceny is the least common of the three major cash misappropriation categories.
45 cash larceny cases were reported, with a median loss of $22,000.

3. What is Cash Larceny? Definition: “Cash” includes currency and checks
Intentional taking
Of employer’s cash
Without employer’s consent
“Cash” includes currency and checks

4. Cash Larceny v. Skimming
Skimming is theft of off-book funds
Cash larceny is theft of on-book funds
Cash larceny:
Less common than skimming
Less costly than skimming
Direct audit trail

5. Cash Larceny Schemes Theft of cash on hand Theft from the deposit
From cash register or cash box
Posted customer payments
Theft from the deposit

6. Theft of Cash On Hand Concealing larceny of cash on hand Unconcealed
Personal check in register
Reversing transactions (voids/refunds)
Alter cash counts
Destroy/alter transaction records

7. Cash Larceny from the Deposit
Perp usually in charge of daily deposit
Steal the currency, deposit the checks
Poor controls are the key
One person prepares/makes deposit, reconciles bank account
Failure to reconcile deposits/receipts
Deposit left unattended before going to bank

8. Concealing Larceny from the Deposit
Deposit lapping
Steal Day 1 deposits
Cover with subsequent receipts
Deposits in transit
Missing money carried on books as “deposits in transit”

9. Cash Larceny - Countermeasures
Investigate shortages in cash drawers, deposits, etc.
Investigate missing or altered sales records
Have two people independently verify deposits on bank statement to postings in general ledger
Maintain and review daily cash availability amounts

10. Cash Larceny - Countermeasures
Have deposits delivered to bank under dual control
If fraud suspected, verify deposit prior to dispatch without suspect’s knowledge; then contact bank to confirm that deposit was made
Have deposits made in night drop, verify at beginning of next day
Make sure deposits in transit are first items to clear on next statement

11. Cash Larceny Controls Separate the following duties: Cash receipts
Cash counts
Bank deposits
Deposit receipt reconciliation
Bank reconciliation
Posting deposits
Cash disbursements

12. Cash Larceny Controls Surprise cash counts
Review check and cash composition of daily bank deposit
Review timeliness of deposits from locations to central treasurer function
Observe cash receipting operations at all points of entry