How Canadian Businesses Can Protect Against Fraud
If you’re a business in Canada, you have likely felt the effects of internal fraud, and you’re not alone. A recent poll looking at Canadian businesses found that half of them believe or know for a fact they were affected by fraud in the past year.
There are many types of fraud, including those situations that come from the inside and the outside, and some of the industries in Canada where it’s most prevalent include banking and financial services, manufacturing, education, and healthcare, and there’s not really any industry that’s immune to fraud threats.
The following are some tips to help businesses in Canada protect themselves, particularly against internal fraud.
Automated Expense Software
One of the primary ways internal fraud occurs is through expense claims and expense management, so putting in place a robust expense claim software solution can combat this.
Employees may fudge the numbers just a little, but over time it has a big impact on revenue and also corporate culture.
If you can automate the processes that go along with expense management, not only are you removing some of the opportunities for fraud, but you also increase visibility into what’s really going on.
Redundancy In Accounting
A lot of companies, even very large ones, operate on the idea that having a single point person who oversees accounting operations is optimal, but this creates opportunities for fraud. Instead of having one employee who’s in charge of making sure everything is correct in your accounting department, having redundancy and various checkpoints among multiple employees can be better.
Some Canadian companies opt to rotate the accounting duties across several staff members, so there’s a better firewall against fraud.
Create a Concrete Code of Conduct
A lot of large businesses don’t have a formalized code of conduct, but this is an important tool when it comes to preventing internal fraud.
Sometimes employees who are behaving fraudulently aren’t necessarily doing so out of maliciousness. They’re doing it because they somehow feel like it’s an accepted part of corporate culture, or they don’t even know what would amount to fraud.
With the example of expense software, employees may think changing their expense reports a bit is no big deal or something everyone is doing
Having a code of conduct not only clarifies things for employees but also makes it easier to deal with fraud when it does occur.
Perform Regular Audits
Very large companies tend to actually find it more difficult to identify fraud than smaller businesses because everyone can operate within their own silos, and it can be tougher to spot when there are many departments and employees, all of whom are doing their own thing.
It’s important to regularly perform internal audits, and when you do spot problems you don’t just acknowledge them, but take real steps to eliminate them. For example, perform a bi-annual internal audit and if problems are discovered make sure that you then train employees and give them the necessary tools to prevent these situations from occurring in the future.