Businesses should institute controls to protect their business assets from fraud or misappropriation. These controls can reduce the potential for business asset loss from both internal and external threats. This article will provide some recommendations for various controls that businesses can put into effect to protect their assets.
Security and Alarm Services
To protect physical assets, businesses often hire security guards or third-party security firms to provide help safeguard business assets. While this can act as an effective control to reduce the loss of business assets, hiring security guards can be costly. As an alternative, some organizations turn to alarm monitoring services. An alarm monitoring service involves the installation of an alarm system and generally a closed circuit television (CCTV) system that scans an area and is observable by a central monitoring station. Upon any actual or perceived threats, the central monitoring service contacts the local police and thereby assists the company from protecting their assets in this manner. An third party monitoring service often involves a set-up fee and reoccurring charges, but these amounts are typically reasonable in cost for the services offered and are a reliable method of safeguarding assets.
Theft from Employees
Many businesses are aware that employees are often responsible for more thefts than outsiders. To control employee theft, businesses install internal controls to limit the amount of money and items that can be stolen. Employees are sometimes required to pass through security checkpoints or to sign for expensive items to reduce the misappropriation of assets. In addition, regular inventory and equipment accounts are compared to regularly maintained listings to identify missing assets early in the process. Security cameras are also useful in reducing the opportunity for fraud from employee theft.
Financial accounting staff also have the unique opportunity to commit fraud by misappropriating assets. Install an accounting system with checks and balances by segregating job functions and having bank reconciliations and material transactions reviewed and signed off on a regular basis. Bring in a third party auditor or conduct an internal auditor regularly who samples a variety of transactions for testing to reduce the possibility of accounting staff misappropriating assets.
Intellectual Property and Data
Intellectual and data theft is becoming increasingly popular over the theft of physical assets and businesses need to install safeguards to protect themselves from electronic theft. Often this is done through the installation of firewalls and encryptions on data that can reduce the access points for hackers. Hackers are slowly becoming increasingly more sophisticated and many organizations need the resources of third party information technology consultants to help install robust data security features to protect their networks.
Businesses often suffer from business asset loss from a variety of different sources, both internal and external. By installing some basic controls a business can protect their assets and reduce the overall shrinkage that they may be encountering. Consider the aforementioned recommendations for installing certain safeguards around business assets and monitor any improvements in asset theft. Protecting business assets is an ongoing process that requires diligence and care. Monitor the process and institute new controls if theft continues.