Accounting Controls Every Hamilton Business Needs to Consider
Proactive accounting controls are the most effective defense against a company’s losses due to theft or fraud. These controls remove the opportunity from potential fraudsters by identifying and shoring up vulnerabilities, and detect any attempts at theft or fraud early to minimize their impact. However, these controls are also very commonly overlooked; after all, a business can slack on their controls and still continue to operate, not realizing the need until it’s too late.
To ensure that your business has the proper Hamilton accounting services in place to adequately secure your business against fraud, make sure that you always consider the following danger points:
Cash is the most vulnerable to theft and can be nearly impossible to trace if a theft is not caught early.
To minimize the risk of cash loss, make sure cash is reconciled regularly. Any withdrawals from petty cash should be accompanied by detailed records and receipts, and your business should do a bank reconciliation every month to catch any discrepancies early.
A bank reconciliation will not only identify irregularities with the cash flow, but will also detect a number of issues such as cheque fraud.
The most common cause of payroll fraud is delegated authority. As a Hamilton business owner, it is your duty to ensure that your accounting services can:
- The hours and pay rates are accurate
- Deductions and personal information are correct
- Former or fictitious employees are not on the payroll
If you have a manager review time cards or conducting other payroll work, there should be some periodic checks and balances to ensure that the manager isn’t letting any misstated hours or improper information slip by.
Missing inventory is a problem that we commonly associate with retail, but which can impact nearly any industry. Just like cash, inventory can be difficult to trace once removed from your premises, and missing inventory can go unnoticed if your business is not vigilant.
To identify theft early, businesses should conduct regular counts to track inventory levels, and then cross-reference that count with your gross profit to see how much of that inventory depletion is expected, and how much is due to lost or stolen inventory.
IT infrastructure is often the most under-estimated risk for a business. Even with antivirus software in place, data loss can be a real threat. Employees will often unwittingly bypass your network security by opening malicious links or files or accidentally delete content, disgruntled employees might maliciously change or delete information, or you could simply lose your data due to hardware failure or natural disaster.
Always have a secure offsite backup that regularly makes copies of all your important files, always ensure that employee passwords are secure, and always make sure that the logins of former employees are deactivated.
Keep Your Books Up to Date with Fuller Landau’s Corporate Accounting Services
Fuller Landau offers a number of services to help keep your books balanced and detect any discrepancies. Our forensic accounting services in Hamilton can help you to both identify any fraud vulnerabilities that your business may have and to identify any ongoing fraud currently being conducted, while our suite of accounting and bookkeeping services can help you keep track of your cash flow to ensure that your business is running smoothly.
To learn more, contact us today for a consultation.