Part-time CFO | Helping Businesses Eliminate Fraud Risks
There are many things that business owners can do to help their businesses eliminate the potential of staff perpetrating fraud within their business says part-time CFO. Many business owners do not understand that their business is at risk. By helping business owners understand what risks occur in their business, can help them make the decisions to eliminate those risks through a variety of options. Since 50% of all businesses are forced to close their doors within five years, and 29% of those businesses often say that the reason why they close the doors was because they ran out of money. By helping business owners eliminate instances that can lose the money, business owners can avoid of the biggest reasons why businesses fail in Canada today.
The first thing that business owners can do in their business to mitigate fraud is by handling their checks very carefully. Many business owners are under the misconception that banks are working hard behind the scenes to avoid any check fraud says part-time CFO. However, businesses must be aware that banks are not actively working to prevent this. Therefore, business owners have to be ultra-vigilant when it comes to handling their checks. They should treat their checks as if they were money. Handling them with care, not leaving them out in the open. Business owners can avoid huge risks just by being careful with how they cancel their checks.
Another very simple thing that business owners can do to help eliminate fraud in their business is to ask their bank to create a read-only access account for the bank account. The reason for this is that employees can work on the businesses finances by seeing all the activity, but actually being able to access and disperse that cash doesnít exist says part-time CFO. This will help the business owner avoid the potential of having their staff move cash out of their account, but will also help the business owner not require to have two staff members work on the finances when they canít actually access the cash.
Something else business owners can do to effectively mitigate fraud risks within their business says part time CFO is by eliminating the petty cash fund. There is no reason for the petty cash fund to exist in the business anymore, since anything that employees may have to purchase can be purchased using a debit card. The business owner should remove the petty cash fund and get a company credit card with limits on it so that employees can purchase the things they need to purchase throughout the day, but without having the risk of being able to access all of the bank account funds.
By being smart about their finances, and being careful with their money, business owners can effectively eliminate several fraud risks in their business. There is no reason for business owners to fear fraud from their employees, so these safeguards are simple and easy to implement and can effectively reduce fraud risk to zero.
Many business owners who start off in their business only have one person working on their accounting for them, says part time CFO. As they grow, they donít ever change the system seems to be working perfectly. However the business owner may not know that they are at extreme risk for fraud. Even if the employee is not untrustworthy, take care to avoid situations where they could potentially lose money, or be defrauded by staff members. These fixes are simple and easy and can put a business owners mind at ease immediately.
The first thing that business owners can do to mitigate fraud risks in their business is to avoid having only one person assigned to working on financial tasks in a business. The reason for this says part-time CFO is because when there is only one person working on financials in the business, that leaves the door open for that person to be dishonest. By having two people working on the finances at the same time, can help keep them honest avoid even the possibility that either one of them what steal money. Another way that this is helpful for businesses is because it can protect the owner from costly financial mistakes. By not having a second person looking at the finances, the business owner could be missing out on fixing important mistakes that could cost them later down the line.
Another way that Employees who are dishonest may defraud the company their working for, is by using dummy corporations to steal money from a business. They do this is part-time CFO, is to create a payment that looks legitimate because itís going to corporation, however the corporation doesnít exist. The employee then pockets the money for themselves. a business owner who is looking over the finances may see the payment going to corporation and assume that because itís a corporation itís legitimate. Business owners need to be very aware when they are reviewing their finances, but if something doesnít seem right, even if the company looks legitimate, they should question and check it out. Or if they have a second person on the financial file, this type of fraud can be avoided.
Another way that employees can defraud the company their working for says part-time CFO is through payroll. The easiest payroll scams is when a employee increases the number of hours that are on their paycheck or they increase the wage they get per hour. These may be small increases, but over a long time of several years, can add up to significant benefit. Business owners can either have two people on this task, or easily and cost-effectively outsource it to a third party payroll provider who can help the business owner completely avoid this risk in its entirety.
By helping business owners see the various ways over their business could be defrauded, can help business owners avoid those fraud risks from the very beginning so that they can about the company in peace.