Working in a cash based environment creates a number of risks for your business, but there are some simple steps you can take to mitigate the potential risks:
1. Conduct a risk assessment
Are you collecting all the cash you are entitled to? If you answered yes, how certain are you of that? You need to know where risk exists before you can eliminate it. Identify your needs and assess the points where risk may be involved. A recent audit we conducted for a client indicated an internal control issue costing the client up to $2,000 per week in lost revenue.
2. Create a process
Have a clearly defined process. Create policies and procedures addressing the issues you’ve identified in the risk assessment. Set out clearly for each step in the process, what the risk is and how to eliminate it.
3. Set the expectation
Education and communication is the key. Set clear expectations from the start. Train staff in the policy and procedure and follow up with them. The organisation must live the policy and make it “the way we do things.” A person who fits and lives the culture is less likely to engage in fraudulent activity.
4. Embrace technology
A relevant and appropriate point of sale and booking system will greatly assist in recording cash based transactions and the cash reconciliation process. Using a system which integrates across different facets of the business achieves this goal. If the appropriate technology is cost prohibitive, use a manual system but create the process and set expectations.
Regularly review the systems in place. Updated technology or new team members may mean that the policy is outdated and may need to be reviewed. Test the processes with an internal audit. Update your policy as appropriate.
If you are unsure how to conduct a risk assessment for your business, contact us today and we’ll help get you started.