Encourage Employee Honesty
Minimize risk of unnecessary losses to your business by making good hiring choices and byanaging an honest and ethical work environment.
You can help to set a tone of dignity and respect and encourage honesty in the following ways:
- Treat employees with dignity and respect.
- Give honest praise and appreciation in public.
- Reprimand and discipline in private. (Certain matters are best discussed with another employee as a witness, but never reprimand/discipline unnecessarily in front of other employees or customers.)
- Pay special attention to employees with financial or personal problems.
- Provide staff with incentives & training.
- Test & retrain on the cash register, balancing procedures, and dual control.
- Balance receipt drawers & pull drawers (make bank deposits) daily.
- Forbid employees from ringing up their own sales.
- Restrict all employees to a single exit.
- Give individual employees their own cash drawer.
- Don’t let employees balance their own drawers independently; implement dual control balancing procedures.
- Establish & enforce policies for dealing with staff dishonesty.
- Set up controls & internal audits.
- Establish & follow a structured refund policy.
- Lock storerooms.
- Investigate inventory shortages immediately.
- Investigate all losses, even minor ones (most embezzlers start small). Look at records of losses over time to detect any patterns.
- Change safe combinations, security codes, and obtain all keys issued when people leave your employ.
- Divide work responsibilities where possible so as to eliminate opportunities for inside theft without collusion.
- Require all disbursement checks to be signed by two people. (Most banks will not accept the liability of ensuring checks have two signatures. This is an internal control procedure for your company.)
- Balance bank accounts monthly; promptly investigate any discrepancies.
- Compare cash receipts with deposits entered on bank statements.
- Lock all cash registers so employees cannot read the totals.
- Number all refund slips & gift certificates (monitor them).
- Lead by example.