What are the best practices for preventing fraud?
Create separate accounting functions for payables and receivables and use multiple employees to process transactions. Accounting checks and balances are a safeguard against errors and fraud, and you don’t want employees to become too comfortable, thinking that no one is reviewing their work. Executives should review the bank statements each month to look for irregularities and compare checks against accounting ledgers. Most banks stipulate that fraud be reported within 60 days, so it’s incumbent upon executives to stay current in their oversight of financial records. Create written procedures directing employees how to secure blank checks and banking passwords and require them to shred cancelled or scrap checks. Also train employees how to recognize e-mails that are really pharming and phishing attacks in disguise and install network security that screens out suspicious e-mails designed to lure employees into divulging your company’s banking information. What should executives do if th
