by Curnow & Curnow, PLLC. • May 13, 2014 • Blog
Common Scenarios that May Signal the Need for A Fraud Examination
- Steps You Can Take to Prevent Fraud
Did you know that fraudulent transactions and situations could be occurring within your business right now, without you realizing? At Curnow & Curnow, our fraud examination services are often engaged when a business owner starts to notice a significant drop in profits or they have a hunch that suspicious activities are being carried out within their organization.
Don’t become a victim of fraud. Here are 3 ways you can prevent your business from becoming vulnerable to fraudulent activities.
1. Structural Red Flags
Structural red flags relate to the physical setup of your company and the procedures and policies that are in place. The longer your employees work with you and understand your systems, the more likely they are to detect weaknesses that they could use to their advantage. Unsupervised areas of the business and unmonitored accounts and transactions that fall below the radar are just some of the vulnerabilities that could be present within your business.
The key task here is to create a structure that prevents and eliminates fraud. For example, you could:
- Create procedures that discourage fraud and ensure that these procedures are monitored at all times.
- Monitor any relationships within the business where fraudulent collusion could be present.
- Educate your workforce about fraud and the policies and procedures that are in place.
- Ensure you have adequate security (physical and software-based) that will protect the integrity of your data and your assets.
2. Personnel Red Flags
There are many things you can do at the personnel level that can help you to protect your business against fraud. For example, using employment screening tools, providing your workforce with concise ethical policies and establishing robust employee monitoring programs can all ensure you never have to worry about fraud. At the first sign of suspicious activity, engage a professional fraud examination service and minimize the damage.
3. Operational Red Flags
How is your business run on a day-to-day basis? Do you strive to minimize problems and errors or are there gaping holes in your operation that need to be filled?
Key questions you should be asking include:
- Does your business have clear lines of authority?
- Are duties segregated enough so that no single employee has too much authority or control in one area, e.g. financial control of the business?
- Do you operate strict controls when it comes to authorization of business and purchasing decisions? Are those controls monitored for compliance?
Don’t Leave Your Business Open to Risk - Speak To Our Expert CPAs About Fraud Examination
It is only when you start to analyze your business and operations in more detail that you start to notice the vulnerabilities that exist. At Curnow & Curnow PLLC, we have the experience and expertise to find the areas in which fraud could be taking place and to also prevent these issues from happening again in the future. Our CPAs have worked on countless fraud examinations and have years of forensic accounting experience.
If you are worried about instances of fraud within your business and need a fraud examination, call 360-676-6655 or request an appointment online