If you want to find a fraud, follow the green.
Here is the new portion of fraud cases and some statistics.
Case # 1: overstatement of bonuses by a commercial director.
In one of the manufacturing facilities, a business director has regularly overestimated the volume of sales of products by fabricating invoices in the accounting base and the volumes of products sold. The amount of bonuses depended on the volume of products sold. Then, these products were returned, but the bonuses were previously accrued and paid. After the scheme was revealed, the manager wrote a letter of resignation.
Regular revision of the volumes of delivered products with counterparties to avoid fake sales.
Case # 2: off the books sales in a barbershop.
Due to the constant blackout in the barbershop, the managing director, along with the administrator, began serving the customers off the books, wiping out/deleting the appointments on the program and manipulating the hours of blackout in the salon, so the owner regularly lost part of the revenue.
Installation of video surveillance cameras with self-generated power supply.
Unexpected controlling visits.
Case # 3: accounting fraud.
In the agricultural company, 100% of the land bank was not included in the register of cultivated lands, which were registered in the accounting department, therefore part of the harvested crop was sold illegally in The form of cash. Nobody controlled the costs. Thus, the real financial result was distorted.
Inventory and revision of land maps, cost control through reasonable budgeting.
Case # 4: selling fixed assets at a reduced price.
In a production holding company, part of the fixed assets,that were on the balance sheet of the enterprise, were written of at a reduced price, then sold at a market price. The difference went into the manager’s pocket.
regular revaluation of the assets by an independent valuer, stock taking.
Also, check below some statistics regarding fraud:
- There is theft in 100% of the companies: minimum 5–15%- Western statistics, maximum- 100% of the turnover -Ukrainian statistics.
- in 80% of the cases -most of the theft is done by men;
- the biggest losses are from top-managers and business partners.
- the highest number of theft is in companies, where F2 (Cash) prevails;
- the departments, in which there is theft and the statistics, are in my previous article;
- the easiest fraud- illegal disposal of assets;
- the most expensive fraud- illegal distortion of accounting;
- the most widespread fraud- corruption (kickbacks).