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Preventing and busting fraud made easy!
Corporate fraud and corruption are a reality of the times, and unfortunately it’s an organisation’s employees that are the major risk factor for fraud. It is the naïve employer who believes that all his employees are honest and that internal fraud cannot happen within his business, so says Paul Marketos.
In South Africa, and in most countries, a great percentage of corporate fraud is internal. Prevention is most certainly the best way of managing fraud. “The tighter the fraud prevention controls and procedures, the harder it is for unscrupulous employees to take advantage. Companies, including smaller businesses, are increasingly realising that controls and procedures must be stepped up to prevent fraud and corruption from within their ranks,” says Marketos. He says that enterprise resource planning
(ERP) systems have significant fraud- prevention and busting potential.
“ERP can assist companies in ensuring compliance with legal requirements and accounting rules. And, if you consider that many cases of internal fraud result from the abuse of the accounting system, it is plain to see how ERP can assist a business in mitigating fraud.
“Manual systems are wide open to abuse because documentation can ‘get lost’ or changed, and there’s no audit trail. With an ERP system in place, companies get tighter control of processes and the benefit of comprehensive audit tracking. Alerts on certain fields can be built into the system so that, if for instance, banking details on an account are changed, an email can be sent to someone in authority to check if the change was legitimate. So,
ERP is also a good way of catching people out as well.
“ERP can also be used to enforce segregation of duties and strict authorisation and approval mechanisms, which prohibit fraudsters from performing functions they are not authorised to do.
A good example is to have different people capture goods receipt notes and supplier invoices.
Modern tools like electronic
funds transfers can also be automated to remove the need for, and risks around, cheques,” explains Marketos.
Director at Bluekey Software Solutions, a local technology company that specialises in the implementation of SAP Business One. More information: 011 794-8999,
www.bluekey.co.za
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