Fraud prevention: 10 helpful checks and balances
Unfortunately fraud prevention measures are a necessity regardless of the size of your company. While you may not be able to foresee every possible scenario, putting in place proper checks and balances procedures can save you from costly surprises.
How do you prevent fraud from happening? Here are a few ideas:
Checks and Balances
- Make sure every bill has a purchase order or has been signed by the person who authorized the purchase.
- Limit the number of people who can authorize purchases and establish a dollar limit.
- Keep blank checks locked up.
- Always use sequentially numbered checks and review the check register to account for any missing checks.
- Limit the number of people who can sign checks.
- Do not use signature stamps or pre-signed blank checks.
- When reviewing an invoice from an unfamiliar company, call the company to verify its legitimacy.
- Have bank statements sent to your home. This allows you to review them prior to giving them to you bookkeeper.
- Have a person other than your bookkeeper reconcile the bank accounts.
- Periodically review the payroll register for accuracy of wages, hours worked, and check that no fictitious or terminated employees are included.
These are just a few ideas to help you develop your own procedures. Depending on the size and setup of your company, there may be some additional considerations to implement.
[message_box title="Get serious about fraud prevention." color="gray"]Our business coaching services can help you get checks and balances procedures in place to protect you and your business. Give me a call at (913) 254-7300 or email me at rusty@fullingmgmt.com to get started.[/message_box]