Cash: The Favorite Target of Fraudsters

Document Type

Article

Publication Date

11-1-2004

Publication Title

The CPA Journal

ISSN

0732-8435

Abstract

Research indicates that about 92% of all asset-theft fraud schemes involve cash, with median losses of $65,000 per incident. Organizations should develop and implement formal programs for safeguarding cash. When one person controls multiple phases of a transaction, the risk of fraud increases dramatically. The most effective way to prevent theft of cash disbursements is to segregate the duties of preparing checks (an authorization duty) and signing checks (a custody duty). The most effective way to prevent theft of cash receipts is to segregate the duties of cash handling and recording.

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