As a business owner it is an unpleasant fact of business that some customers will shoplift, some vendors and suppliers overcharge, some employees embezzle or steal assets, and some partners commit fraud against the business. None of this is new news but it is low priority news for small medium business owners. To protect against these threats, a small business should put into place and vigorously enforce internal controls.
Monitoring the internal control system is used to locate weaknesses and improve controls. Monitoring often includes observing employee behavior and accounting system for indicators of control problems. Some indicators are below:
Warning signs with regard to people:
Evaluation of controls are often performed too late. Establish your policies and procedures to ensure a reference guide for your employees and also for management so that they understand and have additional assurance on how the financial statements are being prepared. Fontenot & Associates Solutions LLC offers unique solutions for your business, visit our website to learn more and start today.
Various precautions can be established to prevent or at least minimize losses from all types of dishonesty!
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