Fraud within a small business used to be rare. But now, many different types of organizations are falling victim to internal fraud. The good news is that while no anti-fraud system is infallible,there are things that small business owners can do to reduce the risk of fraud. Some of these things include:
- Setting up incident reporting systems, including reporting hotlines.
- Hiring and promoting trustworthy people. Business owners should complete background checks before hiring, and implement performance reviews and promotion procedures on an ongoing basis.
- Adopting anti-fraud internal controls. Company owners should also implement management review programs.
- Protecting computer systems by setting up security. Have staff access controls so not just anyone can get into the system.
- Creating a positive work environment by instituting a code of conduct and ethics. Use fraud awareness training programs that clearly spell out expected moral behavior to all staff.
- Having a fraud risk assessment study done by a forensic accountant.
These are just some of the things a small business owner can do to help cut down on fraud. Preventing fraud inside an organization helps keep costs down and may even protect a company from outright failure. Contact Filler & Associates for more information.