Preventing and Detecting Employee Theft and Embezzlement

"e;If you don't think that some employees have figured out ingenious ways to steal from businesses, read this book. The real-life examples will change your mind."e; Joseph T. Wells, CFE, CPA, founder and Chairman, Association of Certified Fraud Examiners "e;An easy-to-read, but comprehensive step-by-step approach that covers every potential area for employee fraud and embezzlement. Great checklists at the end of each chapter show what steps to put into place for controls and protection. Includes real-life examples that really 'bring the story home.' "e; Jean L. Conover, CPA, past CEO/CFO, Jefferson Radiology PC "e;This book is a must-read for seasoned entrepreneurs as well as those considering entering their own business venture. While developed for small business, the risk detection and prevention methodologies presented by Mr. Pedneault are universal to all businesses. The concise checklists provide ready guidance for establishing a complete system of controls."e; Denise H. Armstrong, CPA, Chief Financial Officer, Sea Research Foundation, Inc. d/b/a Mystic Aquarium and Institute for Exploration "e;This book is a must for every individual owning their own business. Mr. Pedneault clearly articulates the fraud risks that occur in each business system. In the book, he offers practical advice for internal controls and illustrates the risks with real-life examples."e; Leonard W. Vona, President, Fraud Auditing, Inc.

"If you don't think that some employees have figured outingenious ways to steal from businesses, read this book. Thereal-life examples will change your mind." --Joseph T. WellsCFE, CPA, founder and Chairman, Association of Certified FraudExaminers"An easy-to-read, but comprehensive step-by-step approach thatcovers every potential area for employee fraud and embezzlement.Great checklists at the end of each chapter show what steps to putinto place for controls and protection. Includes real-life examplesthat really 'bring the story home.' " --Jean L. Conover, CPApast CEO/CFO, Jefferson Radiology PC"This book is a must-read for seasoned entrepreneurs as well asthose considering entering their own business venture. Whiledeveloped for small business, the risk detection and preventionmethodologies presented by Mr. Pedneault are universal to allbusinesses. The concise checklists provide ready guidance forestablishing a complete system of controls."--Denise H.Armstrong, CPA, Chief Financial Officer, Sea Research FoundationInc. d/b/a Mystic Aquarium and Institute for Exploration"This book is a must for every individual owning their ownbusiness. Mr. Pedneault clearly articulates the fraud risks thatoccur in each business system. In the book, he offers practicaladvice for internal controls and illustrates the risks withreal-life examples."--Leonard W. Vona, President, FraudAuditing, Inc.

Preface.Acknowledgments.Introduction.Chapter 1: Hiring the Right Employees.Disclaimer.Where Do You Start?Advice of Counsel.Application Policy.Due Diligence.Personal Information.Past Employment.Education.References.Criminal and Civil History Checks.Credit Checks.Hiring Time.Notes.Chapter 2: Know Your Employees.Why Is Knowing Your Employees Important?Open Communications.What Should You Watch for in Your Employees?Note.Chapter 3: Sales, Cash Receipts, and Collections.Here's Where Everything Starts.Recording and Tracking Sales.Collections.Chapter 4: Credit Cards Sales, Transactions, and Merchant Statements.Processing Sales.Reconciling Sales.Processing Refunds or Credits.Reviewing and Reconciling Refunds or Credits.Reviewing and Reconciling the Merchant Statement.Chapter 5: Purchases, Cash Disbursements, Checks, and Petty Cash.Purchases.Cash Disbursements/Checks.Unpaid Bills/Accounts Payable.Petty Cash.Chapter 6: Credit Cards and Debit Cards.Credit Cards.Debit Cards.Chapter 7: Employee Expense Reimbursement.Expense Submission.Where Are the Abuses?Payment Processing.Notes.Chapter 8: Electronic Banking.Traditional Banking (In-Person Deposits and Manual Check Writing).Check Processing and Clearing Changes.Changes in Bank Deposits.ATM Machines.On-Line Banking.What Can You Do?Chapter 9: Payroll Processing.Payroll Administration: Adding/Changing/Terminating.Payroll Processing.Payroll Tax Returns.Chapter 10: Inventory Issues and Controls.Prevention: Good News and Bad News.Retail Businesses - Items Available For Sale.All Businesses - Items for Use by Employees (Supplies, Tools, and Equipment).Detection.Note.Chapter 11: Bank Statements, Cancelled Checks, and Reconciliations.Bank Statements.Investment Account Statements.Cancelled Checks.Bank Reconciliations.Chapter 12: Financial Reports.Generate Financial Reports Regularly.Why Is the Regular Review of Financial Reports So Important?When to Consider Outside Advice and Assistance?Chapter 13: Safeguarding Your Bookkeeping or Accounting Systems.Manual Bookkeeping Systems.Computerized Bookkeeping and Accounting Systems.QuickBooks Users.Chapter 14: Prevention, Detection, and Insurance.Timing Is Everything.Adequacy of Coverage.Responsibilities for a Claim.Disclaimer.Chapter 15: Your Response to an Identified or Potential Issue.A Dreaded Day of Discovery.Due Diligence on the Discovery.What If It Appears to Be Fraud?Appendix A: Embezzlement Controls for Business Enterprises.Appendix B: Who Is Lester Amos Pratt?About the Author.Index.