Signing Authorities
How to Prevent Embezzlement
In any business organization, there is a lot of cash inflow and outflow. If cash flows are not monitored on a regular basis, there are significant chances of someone from the organization taking undue advantage of it. This can cause significant loss of funds from the company's account and is a serious cause of concern, which must be dealt with in an appropriate manner.

What is Embezzlement?
Embezzlement involves assets and money and is therefore, a kind of financial fraud. In layman terms, it can be referred to as "stealing". Embezzlement involves one or more individuals who take undue advantage of the trust that the organization has on them and use the company's assets for personal gains. The act of embezzlement is carried out in such a way that it remains concealed from other members of the organization. ugg boots outlet Individuals involved in the act have legal rights on the assets which they use dishonestly. In the United States, embezzlement is a statutory crime and is defined differently from one statute to another. There have been instances when business firms have become victims of this act for several years realizing it only when the need of capital came up and funds were missing in their accounts.

How to Prevent Embezzlement in an Organization?

Hiring Right
The first thing a company can do to safeguard itself from being duped by embezzlers is to recruit trustworthy employees. The honesty and integrity of a prospective employee can be analyzed during the interview by the interviewer. Therefore, it is necessary that the interviewer should be a person who has the experience and expertise to select right candidates for the company. Another means of preventing embezzlement is to conduct a reference check for the interviewee. By talking to the candidate's previous employer, one can establish his/her reliability.

Maintaining Financial Records
As the amount of money involved ugg boots for sale United Kingdom in a business firm is huge, it is extremely essential that a record of all the income and expenditure is maintained. By managing financial records, every asset of the company and funds can be traced and accounted for. The books maintaining the accounts of the organization must have a mention of all the transactions made under the name of the company so that, no one can play with them and any missing link can be easily identified.

Dividing Bookkeeping Duties
A bookkeeper is responsible for recording and maintaining financial transactions of the company. Companies with good financial standing can hire more than one bookkeeper so that bookkeeping duties are equally divided and one bookkeeper can easily identify mistakes of the other and none of them gains the courage to play with organization's funds.
Signing Authorities
Most business firms make their payment through checks. To prevent fraud, all outgoing checks must be signed by two people who have the rights to sign checks for the company. In no case, the person preparing the check should have the signing authority because this would give undue advantage to the person thereby, uggs outlet increasing the chances of fraud. Canceled and void checks must be kept separately and mentioned in the records. Bank statements must also be in place so that all payments can be tallied and the entire process can be supervised.

Conducting Surprise Audits
Audits and inspections are a great way of keeping a check on illegal activities going on within the organization. Surprise audits help in identifying loopholes in the financial accounts and taking necessary action against it. Conducting surprise and regular audits not only helps in identifying criminal activity, but also instills fear of being caught among employees who have the tendency of doing such illegal activities.

Apart from these, small business firms can also ugg outlet prevent fraud by keeping a check on petty cash available with the firm, securing unused checks in the lock box, restricting employees to take office work home, insisting on printed invoice before making any payment and reviewing individual expenses. If the act of stealing is suspected, companies must contact the police to take legal action so as to identify the embezzler and set an example for other employees of the organization who might be involved in such activities.