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Mitigating Controllable Risks


There are inherent risks that come with running a company. Some risks are hard to control in your organization, while others you have opportunities to avoid. Below are two of the most common types of fraud in the workplace, along with ways to help avoid or control them.

Payroll Fraud

When it comes to employee timecards, it’s important to be careful how they are approved. If the approval process consists of an onsite manager approving an employee’s hours, it can make it very easy for an employee or a manager to exaggerate their hours, which can result in elevated payroll costs for the company. The best way to avoid possible payroll fraud is to have checks and approvals on multiple levels to ensure hours are accurately kept. If, as a company, you accept the approval of an onsite manager, you can reconcile your payroll accounts and bank statements on a monthly basis to ensure amounts are consistent with expectations. The more checks you have in place, the easier it is to catch fraudulent activity along the way.

Disbursement Fraud

Writing checks and balancing a check book can be difficult for an individual, let alone a company. It is very important to have company protocols in place to ensure nothing falls through the cracks. It can be easy for a check writer to simply write two checks for a payment to a supplier, making the first check out to the supplier and the second check out to themselves. If there is only one individual in charge of making payments, it can be very difficult to discover, resulting in possible loses for the company. One quick way to eliminate this possibility is to require multiple signatures on checks. This ensures a review on each payment by multiple individuals, eliminating the ability of one individual to write unapproved checks.

There are other types of fraud and risks that you may encounter managing a company, but being able to acknowledge possible risk areas is the first step to mitigating risks in the future.


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