Updated: Mar 31, 2020
According to cnbc.com crime in the workplace is costing US businesses 50 billion per year.
30% of Business Failures are caused by employee theft according to the Better Business Bureau.
Personally, one of my clients went bankrupt 3 times due to his brother, sister and wife each at separate times. Small business owners do not have time to work their “trade” and run their business. Most rely on others and because of this, they suffer. Others have the “trade” but not familiar with the business aspect so they have no choice but to rely on others.
Having worked on countless of budgets throughout my lifetime, I must admit it’s all about addition and subtraction. Of course Accounting consists of more than just adding and subtracting, it involves reports etc. BUT if you know how to add and subtract, you can be able to follow up on your financials.
I understand some of you pay others to do it BUT you still should try to keep an estimate of what is going on by yourself. In case some discrepancies occur, you can see well this amount is way off. How? Income and expenses. Total up your income and subtract it by your expenses and you can get a “guestimate” on where you stand financially.
Review your bank statements, income that is reported to you at the end of the year, and most of all your tax returns. Cross reference the figures to ensure that the numbers match.
It’s best to have a separate business bank account and do all transactions under that one account besides your payroll. It’s good to have a separate account for that. Limit the amount of people you give rights to when collecting and spending your money so you can keep track of these individuals. If something was to happen, you will have an easier time to hold someone accountable.
Income is money earned and expenses are money spent. Subtract your expenses from your income and you should be able to get an estimate of how much you currently have. Yes it’s time consuming but don’t be a victim. Even when you do hire someone you feel that you can trust, still review your financials and ASK QUESTIONS! That’s the worst thing you can do is not ask questions. It’s ok. It’s YOUR business. Never feel uncomfortable to the point where you can’t even ask questions. You have that right!
Do you overlook your financials?
Have you ever been a victim of theft? How did you find out and handle the situation?
What steps are you taking to prevent theft from happening to your business?
Any tips to future business owners?
If you would like to learn more about this topic, please feel free to take Profit or Loss/Human Resources & Accounting Workshop.