A weekly look at Wyoming business questions from the Wyoming Small Business Development Center (WSBDC) at the University of Wyoming.
By Piper LeMoine, WSBDC State Office
How can I tell if my employees are stealing from me? Joan, Casper.
Employee theft is something that every business should be concerned about, regardless of size or industry. According to the Small Business Administration, there are several frequently-used schemes including forging and hiding receipts, pilfering merchandise, authorizing salary for fictitious employees, and over-billing expenses. There are many different ways to detect and prevent employee theft, depending on your business and situation.
Businesses that handle a large amount of cash should allow only one person at a time to handle the money. Then, several times a day, or when the employee hands over control of the register to another employee that you choose, make sure the amount of money is what it should be.
If your business handles a lot of inventory, it is important to perform audits. You can do these either on a scheduled basis (i.e., quarterly, monthly, etc.) or without notice, or both, depending on what is best for your situation.
If you suspect that your accountant or another higher level employee is embezzling, you may want to hire an independent accounting firm to perform an audit.
Another option is installing various obstacles to theft, such as surveillance systems, safes, or alarms in strategic areas of your business.
A problem with adopting too harsh a loss-prevention strategy is that it might create a climate of distrust and fear at all levels of your organization. This may result in employees’ unwillingness to report losses, whether they are to blame or not. Employee turnover may increase because of the hostile atmosphere.
It is better to adopt a proactive attitude when it comes to this aspect of business, and prevent employee theft before it occurs. The Small Business Administration recommends keeping all records and warehouses organized, finding people you can trust, and working together with employees. More information is available at the SBA Web site, http://www.sba.gov.
The WSBDC is a partnership of the U.S. Small Business Administration, the Wyoming Business Council and the University of Wyoming. To ask a question call 1-800-348-5194, (307) 766-3505, e-mail wsbdc@uwyo.edu, or write P.O. Box 3922, Laramie, WY 82071-3922. Additional help is available at the WSBDC Web page, www.uwyo.edu/sbdc
Posted on Monday, November 24, 2003