• New Wave Accountants

3 Business Practices that Protect Your Company from Fraud

Running a tight ship is your responsibility as a business owner. You must ensure that you have a business model that promotes the highest level of productivity while minimising losses. That can help you expand your company. Exercising the right business practices will improve your business efficiency and protect you from malicious individuals.

Protecting your company from fraud

Fraud is an individual or a company’s dishonest act that leads to the benefit of self-gain or causes loss to another party through deception or other means. Although it’s essential to trust and think positively of your employees, you must not maintain business practices that malicious individuals can easily manipulate.

If you want to strengthen your company’s defences by preparing for the worst, here are three business practices that will protect you from fraud:

1. Separate control of your assets

The easiest way to leave your company vulnerable to fraud is by giving too much control and authority to one individual. Although you need to have an assigned officer to handle your business operations, you should still divide control of your assets to multiple individuals.

By separating control of your assets, you can avoid the situation where one person is in control of tracking them. Besides doing that on tangible assets, you should also apply the same for IT services. The management of sales, credit control, and other IT-related tasks should go through proper authorisation when making changes to your logs.

2. Enforce a proper authorisation process

An excellent way to keep track of the separation of control on your assets is by implementing proper avenues for authorisation. You must ensure that your employees seek out higher officials when inputting, revising, or removing logs when managing your assets. Implementing this check-and-balance system will allow you to track any discrepancies on your accounts.

Keep in mind, though, that you shouldn’t make a lengthy authorisation process since it can create substantial delays in your company’s output. It would be best if you struck a balance on what’s necessary for your business to ensure security, while still maintaining a decent pace to your overall organisational workflow.

3. Keep accurate and physical records of your transactions

It will be harder for malicious individuals to steal from your company’s assets if you maintain accurate accounts. You should have a simplified record-keeping process for your employees to follow. However, you should make it secure enough to prevent any instances of tampering of invoices, receipts, or purchase orders.

Making it a company protocol to surrender physical copies of transactions to you or your accountant will allow you to make independent checks on digital logs. Keeping these documents will help you in proving ownership and consistency of your assets.

The Bottom Line

As a business owner, you must keep your enterprise safe and secure from errors and threats. Although strengthening your business practices may make you feel like you’re a distrustful boss, it’s a necessary safety measure in running your company. Besides the issue of fraud, you also need these practices to stay on top of various bookkeeping concerns, such as observing tax policies and detecting discrepancies on misplaced orders.

As an added measure on top of your business’s bookkeeping, you can request an external audit to help you cross-reference your financials. Having a reliable accounting firm to look over your accounts as a third-party will ensure that they will assess your company’s files with no bias.

If you’re looking for the best accountants in Gold Coast for an external audit on your company’s bookkeeping, our team is happy to help. Get in touch with us today!

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