Reducing your risk of corporate fraud
Running a small business involves many different tasks, and the last thing that might be on your mind is the risk of corporate fraud. Small businesses are frequent targets of business fraud. If your business becomes the victim of fraud, the losses that you might sustain could cause your company to fail. The top anti-fraud organization in the world, the Association of Certified Fraud Examiners has identified several business practices that might expose companies to potential fraud. Bento for Business also has a convenient fraud calculator so that you can determine your company’s risk of becoming a victim.
Business practices that might make your company vulnerable to corporate fraud
Many small businesses do not have internal anti-fraud controls in place because they lack resources or have simply not considered their importance. The ACFE reports that in 29.3 percent of the corporate fraud cases that it examined, a lack of internal controls contributed to the problem. There are several other characteristics of a business that might increase its risk of business fraud. Businesses may expose themselves to the risk of fraud by relying on check systems in which two or more people have the ability to sign checks. Using cash systems and having petty cash on hand may also expose businesses to fraud. Allowing employees to use traditional company credit cards may also lead to employee thefts. Not having regular surprise audits or strong oversight may also be contributing factors leading to fraud.
In order to eliminate fraud, the ACFE recommends that businesses do several things. They should have strong policies in place for workplace fraud. Employees should undergo training that covers how to identify the signs of fraud and that encourages them to report it. The organization found that businesses that had fraud hotlines established were likelier to receive reports of it than were businesses that relied on in-person reports. Businesses may thus want to establish some method for employees to report fraud that they discover anonymously.
Businesses should limit the number of people who are allowed to sign checks. If possible, they should eliminate all cash and check systems from their companies. One way to eliminate the use of cash and checks is to use business debit cards from Bento for Business. These cards can be used to order supplies, pay for expenses, pay bills and pay for anything else that a business needs to function.
How the cards work
The Bento for Business cards are business Visa debit cards. After you are approved, you order the number of cards that you want for your employees and deposit money into a central account. From this account, you decide how much money to place on each of your cards. You can then establish daily and weekly limits on the amount of money that can be spent on each card. Business owners can limit the spending categories on each card according to their individual employees’ jobs. If a driver needs to be able to purchase gas, his or her card could be designated for pay-at-the-pump purchases only. You can view all of the spending that has happened on your cards from your secure dashboard anytime that you want, and you can turn off a card instantly if you see a problem by clicking a button on your mobile device or laptop.