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Cash receipts theft in our organisations and its prevention

Cash Receipt Fraud occurs in many forms in the organisations. Notably, Skimming and Money Larceny. While Skimming occurs before money appears on books of the organisations, Money Larceny scheme is the theft of money that has already appeared in the organisation’s books.

Background:

Study by Dr Steve Albrecht and two of his colleagues, Keith R. Howe and Marshall B. Romney, in the early 1980s sponsored by Institute of Internal Auditors Research Foundation, stated the need for deterring fraud earlier than it occurrs. The relationships between the perpetrators and the frauds committed by staff were revealed in their book to be correlated. There are motivational factors linked to situational pressure, perceived opportunity to commit and conceal the dishonest act and rationalisation of the act as either being inconsistent with one’s personal level of integrity or justifiable.

SKIMMING IN OUR WORK PLACES:

Skimming is the removal of cash from a victim’s entity prior to its entry in an accounting system. Employee who skim from their companies steal sales or receivables before they are recorded in the company books. Skimming schemes are known as off-book frauds which means stealing cash before it is recorded in the victim company’s accounts. It causes shrinkage and no direct trace from audit trail can be established as it happens.

It is most common forms of occupational fraud. It happens at any point of receiving cash into a business. Individual involves are salespeople, tellers, waitpersons or customer relation officers, and others who receive cash directly from customers.

In skimming, fraudsters conceal fraudulent acts by hiding their identity, but also hiding the fact that a fraud has even occurred. And the victim organisation is unaware of being robbed. In other types of fraudulent disbursements, such as invoice or payroll schemes, someone other than the perpetrator enters the fraudulent payment in the books as legitimate transaction. Payments are generated by the production of false documents to believe that money is owed to a particular person or vendor.

Anti-Fraud fighters like us, managers, industry leaders, investigative journalists and supervisors have vested interest in fighting it all through experiences and collaborative works. 

The following Steps should be adopted by the managers to uproot the evil of skimming in the offices:

•  Companies should routinely evaluate refunds, void and discounts to search for patterns of activity that might signal fraud.

•  Signs asking customers to request and examine sales receipts should be posted at registers

•  Cash disbursements should be recorded on pre-numbered forms and reconciled daily. 

•  An explanation section or code should be included on cash disbursement forms

•  Customers involved in voided sales and refunds should be randomly contacted to verify the accuracy of the transactions.

•  Access to the necessary control keys for refunds and voids should be restricted to supervisors

•  Documentation of void and refund transactions should be remained on file

•  Companies should thoroughly investigate any missing or altered register tape

•  Companies should investigate any gaps in the register tape

•  Multiple voids or refunds for amounts just under review limits should be investigated

•  Customer complaints regarding payment errors should be thoroughly investigated

•  Companies should periodically conduct integrity shopping on all cashiers.

•  All sale receipts should be accounted for and attached to daily cashier’s report

BY GILBERT DORDOR

The writer is a staff of Electricity Company of Ghana Ltd.

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