How Can Companies Control Losses
Did you know?
Companies lose an estimated 5% of their revenue to fraud each year.
Internal controls are crucial for preventing this.
Here are essential controls every company should implement:
1. Segregation of Duties
Divide responsibilities among different employees.
This reduces the risk of fraud and errors.
2. Access Controls
Limit access to sensitive information.
Ensure only authorized personnel can access critical systems.
3. Regular Reconciliations
Conduct monthly reconciliations of financial statements.
This helps catch discrepancies early.
4. Approval Processes
Implement a clear approval workflow for transactions.
Ensure that no one person can authorize and execute a transaction alone.
5. Documented Procedures
Create and maintain clear documentation for all processes.
This ensures consistency and accountability in operations.
6. Training and Awareness
Regularly train employees on internal controls.
An informed team is your first line of defense.
7. Monitoring and Auditing
Establish a routine for internal audits.
Regular assessments help identify weaknesses and improve controls.
Strong internal controls protect your business and enhance trust.
