It’s hard to imagine that a trusted employee would take advantage of your business, but fraud does happen. So much so that the Securities and Exchange Commission (SEC) has created a new task force to investigate accounting fraud and improper financial reporting. There are several business areas that you should keep an eye on, but you can start protecting your business against fraud by using an enterprise resource planning (ERP) solution that offers an audit trail.
Entry-level accounting programs do not often include many security features, such as the ability to track changes being made in your data. At any time, an employee can make an innocent mistake or an intentional act leading to fraud, and make changes to financial figures. Mistakes can lead to skewed reports that can land you in hot water with the SEC, taxing agencies, shareholders, and others. Fraudulent acts can trickle cash out of your pockets with you even noticing. Either way, mistakes in your financial data can create problems that could paralyze your business, if not shut you down altogether.
As noted in “7 Strategic Ways to Grow Your Business,” posted on CollinsComputing.com, fraud takes place in one of these six departments: accounting, operations, sales, upper management, customer service, or purchasing. You can protect your business by implementing a comprehensive enterprise resource planning (ERP) solution that can collect data from each of these core departments and others. With all of your data in one location, you can access it easier and monitor data for changes that may indicate fraudulent activities or poor business practices. In addition, ERP offers audit trails and other security features. You can enable permissions so that employees can only access information that they are permitted to access and change it within established limits. For example, certain changes in payroll or payouts to vendors over a certain dollar amount can trigger an automatic notification for approval by a manager. Changes in data are also marked with an electronic audit trail that documents the person changing the data and a reason for that change. Managers can validate these changes at any time.
It is unfortunate that fraud happens but you don’t have to let it happen to you. The right technology will help you monitor your business for fraudulent activities, as well as provide greater control and insight into your business data. Contact Collins Computing for more information about using ERP to protect your business against fraud.
By Collins Computing, a Microsoft Dynamics GP Gold Certified Partner out of California
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