Boring Speech

This is part of a presentation I gave at a convention of well boring companies.  It’s about protecting your money, and it applies to most any type of operation, including clubs and associations.

Finally, I’d like to talk about one of your employees, who I’ll call Betty.  She has been with you for a long time, helping in the early days as you tried to grow your business. She does everything around the office, from billing customers and paying your bills to running payroll.  She is indispensable.  She watched your kids grow up and bakes you a red velvet birthday cake every year.  You rely on her to take care of the office so you can run the rest of your operation, which is a lot more fun than doing paperwork.

Oh, there is one thing I forgot to mention:  She’s stealing from you.

Now before you get offended, I certainly realize that only a very small percentage of the Bettys in the world are embezzlers.  However, let’s look at it from the other direction.  The only people who will steal from you are the people you trust, because if you don’t trust somebody you won’t let them anywhere near your money in the first place.

You need good financial control systems.  It’s not personal and it’s not insulting.  It’s just sound business.  You don’t do employees any favors by having such slack systems that there are obvious ways they can augment their income a bit.  Many of these cases start when an employee has a bad week, and just needs to “borrow” a bit to get through the crisis.  Somehow they never quite get around to putting the money back, and it makes it easier to go back to the well the next time they are a bit short.

In addition, let’s assume that you find out that money is somehow going out the back door.  If the controls and procedures are not there, Betty won’t be able to prove her innocence, which is extremely unfair to her.

You need to get your outside accountant to review your systems.  There are many easy things to do to reduce your risks.  For example, the person who pays the bills and writes the checks should NOT be the person to balance the checkbook.  In fact, the owner should be the one to balance the checkbook.  Where possible, the owner should also be the first person to go through the mail.

I’m not trying to be anybody’s accountant, but there is one thing I want to point out from my area.  There are accounting software systems out there that allow you to print a computer check and then turn around and delete it so that there will be no record of it anywhere in the system.  It doesn’t take much imagination to see what could happen.

If you’re thinking, “This would never happen to me, my people are all trustworthy”, I’ll give you one last example.  The owner of a Mom & Pop business realized somebody was skimming money out of the company.  Pop arranged for an outside investigation which quickly revealed the culprit.  It was Mom.



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