By Hayes Knight – 7 December 2010

For clients who were at the annual schools update seminar we held recently, you will recall we spent a lot of time on the subject of fraud.

We thought it would be useful to provide some summary helpful tips in this area.
  • Remain skeptical – Think the worst and prove the best!  Sadly the most successful fraudsters were usually known as highly trusted and valued employees….until their fraud was detected.
  • Educate all concerned of the risk of fraud and it’s negative impact on your school; trustees, admin staff, subcontractors, suppliers, etc.  The more people who are aware of the risk, the harder most frauds become.  Mobilise the moral majority!
  • Review and revise your financial controls – particularly whenever changes occur.  Ensure the controls surrounding finances and operations in place in your organisation are appropriate to the loss you could suffer.  Where possible make sure there is more one person involved in any financial process.
  • Seek independent assistance – A review of your systems and controls by an independent, expert third party can be highly beneficial.  Often it takes a fresh set of eyes with experience in the field to see the opportunities and threats clearly.  The Hayes Knight team have valuable experience in this area.
  • If you do find fraud…take action!  If you don’t, all that happens is that you unleash this person on some other unsuspecting organisation.  Sadly there’s evidence of some fraudsters ‘practicing’ on a number of schools before finally getting hauled before the Police and the Courts.
  • If you do suspect fraud in your organisation it’s essential that you immediately seek appropriate advice from an expert such as an auditor or forensic accountant with fraud investigation experience, or a solicitor who has taken fraud cases.  It is unfortunately easy to destroy your chances of recovery of funds if the correct process is not followed.  It is also ridiculously easy to finish up on the end of a personal grievance claim from the fraudster – costing your school even more money!

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