It’s no secret that owning a business is stressful. While you are juggling responsibilities to keep the doors open and the customers happy, you may not have time to safeguard your business against potential fraud, especially when it comes to employee theft.
Each year businesses lose an estimated $50 billion due to employee theft. Though the media highlights fraud in large businesses, small and medium-sized business take the brunt of most of it. Many small business owners simply may not know what steps they could take to prevent losses. But there are really surprising steps such as:
Know your employees
Even the most loyal and trustworthy employees can steal from your business. At a small business, you and your employees may feel tight-knit, like a mini family, but you can never be too safe. Observing your employees’ behaviors can help you spot potential fraud. Look for a change in behavior, whether it be in or out of the workplace.
Being vigilant when considering new hires is also important in preventing fraud. Running a background check of each new employee can help you spot potential issues.
Train employees to recognize fraud & have reporting system in place
While you’re managing your business, it may be difficult to monitor everything that is happening “down on the ground.” Therefore, it is helpful to train your employees on how to recognize and report fraud. If they know what to look for, then they have the potential to spot something you may otherwise miss.
Divvy up accounting duties
As a small business owner, you may only have one person overseeing all accounting functions, but what if this person slips a $20 bill from the cash pile each week? It could go unnoticed and have significant effects on your business. Having more than one person handle accounting functions, and even separating them, can minimize the risk of fraud and help you keep better tabs on your business.
Reevaluating your protective measures
Preserving the success of your business is your number one priority. Taking preventive measures can help give you peace of mind while minimizing the risk of fraud. However, it is important to periodically reevaluate the protective measures to adapt to your changing workplace.