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The first and most common way business owners place themselves at risk, is that they only have one person working on a financial task. The reason why this is a recipe says part-time CFO, is because that one person is a lot more opportunity to be dishonest if they are the only person working on the file. This doesnít mean that everyone in that position is dishonest, or will steal, but by doing nothing to deter the dishonest employees, but itís business owners at risk. They can very easily avoid this altogether by ensuring that they have two people working on any financial file at a time. This also can help business owners safeguard against mistakes from honest and will intentioned employees. Mistakes will happen, and by not having a second employee looking over the finances they are being worked on, increases the chances that mistakes will not be caught until much later when they are bigger and harder to fix. Business owners should also be aware that having two people working on finances at any given time also safeguards those employees, which they should be appreciative of. Having two people work on something it ensures that nobody can accuse the employee of wrongdoing
As a way that employees working solo on finances can steal from the company is through payroll. One of the most common ways that employees steal from the company says part-time CFO and often donít even think that is stealing, is that they increase the number of hours theyíre going to get paid, or they inflate the wage per hour that theyíre going to receive. Dishonest employees who are very smart, will increase the wage or the hours a little bit at a time, so they donít arouse suspicion. That way, they could steal a little bit of money over a long period of time. By not having to employees work on payroll, business is open themselves up to this risk.
The second way that employees in defraud companies they work for through payroll is through CRA remittances. This is much more difficult to catch says part-time CFO. And how they do it is that they calculate all of the payroll remittances that should be going to CRA and then add a little bit more. They send in that extra amount under their own name, and at the end of the year, CRA notices that they paid too much in taxes and issues them a refund check. They cash that check and in a roundabout way have stolen from the business.
There are several challenges a business faces that a business owner has when they open their business says part-time CFO. One of the main reasons why businesses fail according to industry in Canada is that they ran out of cash. One of the ways that businesses can run out of cash in their business unfortunately is through theft and fraud. It be extremely disappointing for business to have to close their doors because they had someone stealing from them in a way that was completely preventable. However a lot of fraud that happens in small businesses are completely avoidable and business owners should take immediate steps to protect themselves against this kind of activity.
One of the first things that a business owner can do in order to guard against the fraudulent activity helping in their business, is to meet regularly with their accounting team recommends part time CFO. Business owners should take this quick monthly meeting as an investment into their business to be able to chat openly with the people that work on their finances. Questions can be asked and double checks can have been in this meeting, and often if there has been any fraudulent activity, it can then be caught at this point. If the accountant brings banks to the business ownerís attention that the business owner may not have realized was happening.
Another way that business owners can avoid fraud very easily in their own business is creating read-only access to their bank accounts that staff will work on. Business owners can go to the bank and request that they have read-only access portal created for their bank account, so that employees can see all the activity in the bank account, but not access the cash in any way says part time CFO. This can allow the business owner to have them work on finances, with no risk to themselves.
Business owners should also know that there shouldnít be communal credit cards floating around their office. Thatís if they use credit cards at all, it should be issued to the one employee who needs it, and that they take the care and to ensuring that they are safeguarding that cards credentials. If a business owner does need to have payment options for the rest of their staff, a much better option says part-time CFO is a company debit card. A business owner can put limits on the card and also locket from being able to make purchases on the Internet. That way employees can make the purchases that are necessary, without the business owner running the risk of having thousands of dollars stolen from them.
