Preventing Embezzlement

No matter what size business you have, maintaining controls protects you and reduces your risk. Read these tips for internal audit controls:

1. Audit - Periodically audit your check stock to ensure all unused checks can be accounted for.
2. Bank Accounts - For a better audit trail, you may want to have separate accounts and separate employees for accounts payable and accounts receivable .
3. Bank Statements - Examine statements immediately when they come in the mail (or online) in order to monitor fraudulent account activity.
4. Check Stock - Keep your check stock locked up at all times. When checks are printed, every check should be accounted for, including voided, jammed and cancelled checks.
5. Document Management - Protect all documents by locking them up and always maintaining a "clean desk" policy. If documents need to be discarded, shred them!
6. Employees - Screen new employees by having background checks performed before making a job offer - even for part-time employees or contractors.
7. Paper vs. Electronic - Investigate areas where moving to electronic processing and operations will reduce risk and increase controls by making it tougher to destroy and hide important documents.
8. Segregation of Duties - Have someone independent of check writing responsibilities reconcile your bank accounts. Rotate personnel on a quarterly basis.
9. Protect All Accounting Documents - Secure check stock, signature equipment, invoices, statements and other critical information.