Estimates show that over 5% of all revenue is lost to fraud and theft each year. The numbers are staggering - odds are if you have not experienced it, you will.
One of the best ways to prevent fraud and theft is to implement a system of internal controls (though no system of internal control can prevent all fraud and theft). We have developed a comprehensive checklist of internal controls you should be using, but here are our top 5:
Audits are important. Investors, lenders, government agencies, potential buyers and - in the case of not-for-profit organizations, your donors - rely on audit reports to assess your organization. Audits can be long, arduous, headache-inducing ordeals…but they don’t have to be. Proper preparation can go a long way towards simplifying the audit process.
Part 5 of a 5 Part Series
Can board members be held personally liable for actions of the organization? Yes!
Agreeing to sit on a board for a nonprofit is a great way to donate your time and expertise. However, it comes with a great deal of responsibility.
For many companies, keeping close tabs on revenue, expenses, and profit is the number one priority. However, companies that carry inventory may not realize its direct effect on profitability. This effect is known as shrinkage. Shrinkage is the excess amount of inventory (in accounting records) that no longer exists in the actual inventory. In other words, it is a loss of inventory. There are several causes of shrinkage, such as:
