Tuesday, January 12, 2016

Employees Who Steal

When stocktakes are held and amounts of stock cannot be accounted for, the accounting profession refers to it as "shrinkage."

Shrinkage isn't necessarily stealing, it may also be caused by miscounting, errors in oversupply, paperless transactions and a host of other things.

It is true, however, that many employees steal from their employers.

Even those of us who aren't habitual thieves often take home more stationery than we perhaps should - and share it with our family members. People with company cars burn fuel going shopping or doing what in Australia are called "foreigners" - foreign jobs.

While minimal personal use of a company's assets can create an aggregate loss eg, 2,000 employees all taking $5 stationery adds up to a grand sum, people intent on stealing can devestate a company's bottom line.

Worst case examples involve people who have transferred millions of dollars of company money illegitimately to accounts they hold or others' accounts.

Someone who works in a kitchen and steals a few kg (lbs) of cheese and steak every few days can impact on the organisation's profit.

How do you overcome stealing?

It's probably realistic to expect a little shrinkage, but sound systems of stock control, multiple signatories for invoices and good practices and procedures help.

You can spend so much time and money trying to eliminate stealing that it becomes the problem and not the stealing, but a firm needs to make a reasonable effort to eliminate theft.

Six monthly audits, movement of people from one job to another can also help as can monitoring of such things as credit card use.

Every firm needs to do a security assessment to identify and eleviate weaknesses that could be taken advantage of by an employer so intending to thieve.

When someone is caught, not only should they be dismissed, they should also be prosecuted.

How does your employer stack up for reducing or eleviating theft?

Robin

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