Disappearing Profits
()
About this ebook
Who’s stealing from your business? What are they taking and how do they do it? How do you stop them?
According to the Association of Fraud Examiners, the amount of money reported lost to business fraud each year is estimated at 6% to 10% of company revenues. That is over $400 billion dollars per year reported as lost to fraud.
Disappearing Profits defines fraud, identifies the types of businesses most susceptible to fraud, the employee’s most likely to steal from a business, how they steal and what you can do to stop the stealing.
If you’ve been in business for more than a year and you have over five employees, you have probably been the victim of some sort of business fraud. The fraud may not have resulted in a significant loss to the company ... yet. The fraud may go undetected for years. Fraud always happens in a company that doesn’t think it can happen to them. If they thought it could, they would do something about it.
How would you answer these ten questions at your company?
Do you have a written code of conduct and ethics policy that all employees’ have been trained on and agreed to?
Do you live by the code of conduct and ethics policy? Are you a good example?
Do you have a culture that rewards compliance with company policy and punishes non-compliance?
Do you separate the asset responsibility from the record keeping?
Do you review the work of your longest tenured, most trusted employees on a periodic basis?
Do you know every vendor you deal with, why you deal with them and what they provide to the company?
Do you get a control listing of checks received and compare it to the deposit slip on a daily basis?
Do you review your credit card statements monthly and verify that all charges are legitimate company expenses?
Do customers claim they never got the merchandise you invoiced?
Can inventory write-offs be explained?
If the answer to one or more of these questions is no, you have an environment that is an opportunity for someone to commit a fraud against your company. The question is not if fraud has or will occur, the questions are who, when and how the fraud will occur.
Dave Guenthner
Dave Guenthner is a business executive, consultant, speaker, author and avid golfer. Born and raised in South Dakota, Dave received his Bachelors degree in business and attended law school at the University of South Dakota. Dave resides and golf’s in Omaha, Nebraska. Dave has played the “business course” under par in several different industries and companies in his 30 + year career. He began his career as a Certified Public Accountant and has held senior executive positions in companies in food products, manufacturing, distribution, medical staffing and information technology. Dave co-founded and was instrumental in growing a company, InaCom, from an idea into a $6 billion publicly traded Fortune 500 company. He has worked with companies that have been named numerous times to the Inc. 500 fastest growing private companies in the United States. Dave writes about business and is focused on sharing his experiences to help other executives and companies optimize their business and achieve their growth and profitability goals. When he golf’s, Dave always shoots in the 70’s....the only question is how many holes he has to play before the round is finished.
Related to Disappearing Profits
Related ebooks
Protect Your Business From Employee Fraud Rating: 4 out of 5 stars4/5Tax Problem Resolution Scam: How Some Tax Resolution Companies Steal Your Money! Rating: 0 out of 5 stars0 ratingsCredit Repair Rating: 0 out of 5 stars0 ratingsTragedy of Fraud: The Ripple Effects From Fraud and the Wages Earned Rating: 0 out of 5 stars0 ratingsMMG Guide to Banking Basics for College Students Rating: 0 out of 5 stars0 ratingsThe Short-Term Retirement Program: Break Out of Your Financial Prison Rating: 0 out of 5 stars0 ratingsThe New Income Tax Scandal: How the Income Tax Cheats Workers out of Million$ Each Year and the Corrupt Reasons Why This Happens Rating: 0 out of 5 stars0 ratingsTop Secrets for Persuading the Debtor to Pay You Now Rating: 5 out of 5 stars5/5Little by Little Rating: 0 out of 5 stars0 ratingsTackle Your Payroll Tax Debt: Proven Strategies Every Sub-Contractor Business Owner Should Know While Dealing With the IRS Rating: 0 out of 5 stars0 ratingsIdentity Theft – Don’t Be The Next Victim! Rating: 0 out of 5 stars0 ratingsMortgage Underwriting A Complete Guide - 2021 Edition Rating: 0 out of 5 stars0 ratingsA Guide to Ethical Practices in the United States Tax Industry Rating: 0 out of 5 stars0 ratingsBasics of Banking Rating: 5 out of 5 stars5/5Running a Good Business, Book 4: Start-Up and Legal Matters: Running a Good Business, #4 Rating: 0 out of 5 stars0 ratingsThe Online Identity Theft Prevention Kit: Stop Scammers, Hackers, and Identity Thieves from Ruining Your Life Rating: 0 out of 5 stars0 ratingsWhat Is the IRS and What If I Owe Taxes? Rating: 0 out of 5 stars0 ratingsProtecting Seniors/Elders from Fraud, Scams and Schemes Rating: 0 out of 5 stars0 ratingsLandlord Tax Planning Strategies Rating: 0 out of 5 stars0 ratingsHow to Pay Zero Taxes 2016: Your Guide to Every Tax Break the IRS Allows Rating: 0 out of 5 stars0 ratingsHow To Stop Harassing Debt Collection Calls Rating: 0 out of 5 stars0 ratingsVirtual CFO A Complete Guide - 2021 Edition Rating: 0 out of 5 stars0 ratingsAuto Loans: The Complete Guide to Auto Financing Rating: 3 out of 5 stars3/5Death by a Thousand Cuts: The Fight over Taxing Inherited Wealth Rating: 5 out of 5 stars5/5The Identity Theft Protection Guide: *Safeguard Your Family *Protect Your Privacy *Recover a Stolen Identity Rating: 0 out of 5 stars0 ratingsOffshore: Tax Havens and the Rule of Global Crime Rating: 3 out of 5 stars3/5Credit Card Risks Crash Course Rating: 0 out of 5 stars0 ratingsHow to Negotiate and Settle Your Debts While Restoring Your Credit...: So Don't Get Bummed out over Your Debt! Rating: 0 out of 5 stars0 ratings
Accounting & Bookkeeping For You
The ZERO Percent: Secrets of the United States, the Power of Trust, Nationality, Banking and ZERO TAXES! Rating: 5 out of 5 stars5/5The Book on Advanced Tax Strategies: Cracking the Code for Savvy Real Estate Investors Rating: 4 out of 5 stars4/5The Intelligent Investor, Rev. Ed: The Definitive Book on Value Investing Rating: 4 out of 5 stars4/5Bookkeeping: An Essential Guide to Bookkeeping for Beginners along with Basic Accounting Principles Rating: 4 out of 5 stars4/5Accounting For Dummies Rating: 5 out of 5 stars5/5How to Start a Nonprofit Organization: The Complete Guide to Start Non Profit Organization (NPO) Rating: 4 out of 5 stars4/5The Tax and Legal Playbook: Game-Changing Solutions To Your Small Business Questions Rating: 3 out of 5 stars3/5Profit First for Therapists Rating: 0 out of 5 stars0 ratingsBookkeeping For Dummies Rating: 5 out of 5 stars5/5Profit First (Review and Analysis of Michalowicz's Book) Rating: 5 out of 5 stars5/5Taxpayer's Comprehensive Guide to Llcs and S Corps: 2016 Edition Rating: 5 out of 5 stars5/5Start, Study and Pass The CPA Exam FAST - Proven 8 Step CPA Exam Study Playbook Rating: 5 out of 5 stars5/5CPA Review Notes: BEC 2022 Rating: 3 out of 5 stars3/5Accounting for Non-Accountants: The Fast and Easy Way to Learn the Basics Rating: 4 out of 5 stars4/5QuickBooks 2024 All-in-One For Dummies Rating: 0 out of 5 stars0 ratingsOvercoming Underearning(TM): A Simple Guide to a Richer Life Rating: 4 out of 5 stars4/5Bookkeeping Basics: What Every Nonprofit Bookkeeper Needs to Know Rating: 4 out of 5 stars4/5Streetwise Incorporating Your Business: From Legal Issues to Tax Concerns, All You Need to Establish and Protect Your Business Rating: 0 out of 5 stars0 ratingsImplementing Value Pricing: A Radical Business Model for Professional Firms Rating: 5 out of 5 stars5/5QuickBooks: A Beginner’s Guide to Bookkeeping and Accounting for Small Businesses Rating: 0 out of 5 stars0 ratingsBookkeeping: Step by Step Guide to Bookkeeping Principles & Basic Bookkeeping for Small Business Rating: 5 out of 5 stars5/5Your First CFO: The Accounting Cure for Small Business Owners Rating: 4 out of 5 stars4/5
Reviews for Disappearing Profits
0 ratings0 reviews
Book preview
Disappearing Profits - Dave Guenthner
DISAPPEARING PROFITS
Business Fraud And How To Stop It
By Dave Guenthner
-
Published by Dave Guenthner at Smashwords
Copyright 2012 Dave Guenthner
License Notes: This ebook is licensed for your personal enjoyment only. This ebook may not be re-sold or given away to other people. If you would like to share this ebook with another person, please purchase an additional copy for each person you share it with. If you’re reading this book and did not purchase it, or it was not purchased for your use only, then you should return to Smashwords.com and purchase your own copy. Thank you for respecting the hard work of this author.
TABLE OF CONTENTS
HOW: BUSINESS FRAUD HAPPENS
WHO: THE TARGET
WHAT IS FRAUD
THE COST OF FRAUD
WHO COMMITS FRAUD
WHY EMPLOYEES COMMIT FRAUD
WHAT AND HOW
SEVEN WARNING SIGNS
PROTECTING AGAINST FRAUD
CONCLUSION
FRAUD RISK EVALUATION
CODE OF CONDUCT AND ETHICS
PERSONAL FRAUD PROTECTION
ABOUT THE AUTHOR
HOW: BUSINESS FRAUD HAPPENS
A while back I got a call from a client. He was angry. There was a tone of shock, denial and disbelief in his voice.
Dave, I can’t believe it. I’m pretty sure, no, I’m positive one of my employees’, the controller I hired six months ago, is stealing from me.
I asked, Why do you think that?
I read about him in the paper. He was called to testify at a gambling trial. In his testimony he said that he had stolen from his previous employer. I asked him if he was stealing from us and he said he couldn’t say that he wasn’t.
How did he do it and how much did he take?
I asked.
I don’t know how he did it but he said I signed all the checks for the cash that he stole. He claims that he only took a few thousand dollars but given our cash flow lately, it could have been a lot more.
I went to the client’s office. After talking to the controller and reviewing checks for a few months, a pattern began to develop. The controller made the payroll tax deposits for the company. The checks were made out to the bank and deposited in a special bank account. The controller had opened his own account and was having the President occasionally sign checks for payroll tax deposits
that were duplicates. My client wasn’t paying attention and missed what was going on. The controller had stolen over $200,000 from the company