Finance & Enjoyment Blog

How’s the financial health of your business? You probably check the pulse of the business financial health by regularly watching the cash flow and even reading the monthly financial statements. But have you examined the internal financial structure of your business recently? 

To conduct a business self-assessment, answer “yes” or “no” to this list of questions:

  1. Do you know how transactions flow through your business?
  2. Do you know who in your organization is responsible for specific financial functions? (deposits, check writing etc.)
  3. Are financial functions divided among two or more persons?
  4. Are all your employees required to take vacations each year?
  5. Is there oversight of employees involved in financial transactions? Is their work examined periodically?
  6. Are you billing appropriately and correctly for all your hard work in a timely manner? Does anyone review the billing reports from your in-house billing department or from your outside billing service?
  7. Is your mail opened and deposit slips prepared by someone with no access to the billing system or the company accounting system? And does that person endorse all checks immediately?
  8. Are bank reconciliations and the company accounting done by someone who has no access to the billing system or to the checks and cash received?
  9. Are supplies and equipment orders approved by management or owners?
  10. Are new vendors verified for authenticity?
  11. Are independent price checks or bids requested periodically and compared to actual orders?
  12. Does the person signing the checks have adequate time to review the attached invoices?
  13. Are employee payroll changes in writing and approved by management or owners?
  14. Are background checks performed for prospective employees?
  15. Are payroll reports periodically reviewed by management not involved in the payroll preparation?
  16. Is the accounting system data regularly backed up and stored off-site?
  17. Are passwords used to limit access to accounting, payroll and billing systems?
If you answered “no” to one or more of these items, and are wondering how this might jeopardize your business, contact us to find out how you can protect yourself from internal theft.

Stories of embezzlement that we learn about show that the most prevalent sources are trusted employees in charge of all financial tasks, with little or no oversight. Other sources of embezzlement can include employees under financial stress and new employees who may have a record of such activity at previous places of employment.

Call us today at 303.815.1100 to arrange an examination of your financial health systems.

 


Posted in Your Financial House »



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