Vitalics how important are internal controls for small business
10
Click here to load reader
-
Upload
julia-blair -
Category
Business
-
view
116 -
download
1
Transcript of Vitalics how important are internal controls for small business
How Important are Internal
Controls for Small Business?
Important information for Small BusinessesPresented by Business Fraud Prevention and The Vitalics System
The Problem – Fraud Loss
According to the 2012 AFCE report to the nations, participants in the
survey estimated that the typical organization loses 5% of its revenues to fraud. The report further states that the average fraud loss is $140,000 per fraud occurrence and more that 1/5 of these cases had losses of at least 1 million.
A Closer Look
As we look closer we find that most of these businesses never recover their losses. What would a $140,000 fraud loss do to your bottom line?
There are a vast number of loss avenues that exist, everything from skimming, to tampering and most common in all industries are billing schemes.
According to the AFCE, tips from employees account for the vast majority of fraud detection and the average fraud lasts eighteen months. How long can you afford to wait for someone to come forward?
Small Businesses Suffer The Most
Employers with fewer than 100 employees have the greatest incident of fraud frequency compared to any other organization.
The smallest organizations suffered the largest median losses.
Nearly half of victim organizations do not recover any losses that they suffer due to fraud.
0
10
20
30
40
50
< 100 100 - 999 1,000 -9,999
10,000+
Per
cen
tage
Fraud Frequency by Size of Victim Organization
2012
2010
2008
2006
2004
2002
Industries Hardest Hit
Manufacturing Construction Service Industries Retail ChurchesNon-Profits Clinics
Is Your Company In denial?
Most small businesses fall victim to occupational fraud more often due to denial –denial that fraud will occur in their business in the first place. Or lack of budget, they think they can’t afford to implement an effective yet affordable internal control system.
Components of an Internal Control System
All businesses have or at least should have procedures, plans, and policies in place to ensure that the organization operates as efficiently and effectively as possible.
The objectives of internal control systems are:
Organizational goalsOperational efficiencies Safeguard assets against waste, fraud, misuse, and unauthorized use
of resources Accurate and proper reporting and recording of revenue and data.
Finance – Bank Reconciliations, Disbursements, Receipts, Ass
ets, A/R
Operations – Know your employees, background checks, procedure
Administration – Assign responsibility, operating style
Owner Internal control systems keep the small business safe from
fraud and common office errors. Easy to review financial records for approvals, chain of
custody and back-up documentation Maintains Accountability - Provides trust and accountability
between staff and owner
CPA / Bookkeeper
Value added service for your clients
Protect yourself with documentation
Your job is easier, with clients using the same method.
Internal Control Systems Protect Both Sides
The Solution = Vitalics
Vitalics™ is the Vital Internal Control System that was designed by a Certified Fraud Examiner specifically for the Small Business. The Vitalics™ System makes it easy to set up controls with customizable forms, checklists and reconciliation templates. It also includes vital education on business fraud prevention which your company needs. This system allows the owner to be involved and approve day to day accounting without consuming an enormous amount of time.
New Desktop Application!!
Integrate other custom made forms (not just Vitalics) Word, PDF and Excel forms into the application. These include QuickBooks / Peachtree reports sent to Excel or Word.
Create new categories Modify forms to company and print for authorization Free lifetime upgrades on all forms
Vitalics – Desktop Application includesOver 118 Forms & Checklists and a 72 page Fraud Prevention and instruction electronic book.
$269.00 Hard Copy with CD$249.00 Electronic Download
Individual forms are available for purchase on our website – Vitalics
Desktop Application not included on single form downloads.
Also available – Forms for Independent Internal Control Auditors
Become an Affiliate and help protect your small business clients!
Affiliate Program – Vitalics - Free to join Receive 10% - 25%
Please contact us if you
have any questions.
http://www.thevitalicsystem.com
P.O. Box 7275
Loveland, CO 80537
