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Keeping a firm secure is crucial to its smooth operation. While there are numerous possible threats that could threaten your company in one way or another, financial crimes are among the most dangerous. Many forms of financial crime exist, and they may not only damage your company's money but also its reputation. Fortunately, there are specific steps you can take to safeguard your business and lessen the likelihood that you'll ever have to deal with one.
Money laundering, bribery, corruption, fraud, tax evasion, forgery, counterfeiting, terrorist financing, and identity theft are some examples of financial crimes. In most cases, financial fraud is very difficult to detect. Even though many businesses do not devote much emphasis to detecting these frauds, they cause significant losses because they go unnoticed for a long time. One of the best ways to prevent financial fraud is to outsource your accounting and auditing services to professional firms in the UAE. Now, let’s have a look at a few of the practices that can be followed to prevent financial fraud.
Staying up-to-date and training employees
Monitoring changes to laws and regulations and updating the company's policies in light of such changes should be your top priority. If a company fails to adapt to change, it may create a loophole for a fraudster to commit a crime. Also, make sure your employees are well-trained in identifying any kind of financial crime and ensure you provide them with a proper understanding of the risks associated with financial crimes, as well as how to combat those crimes.
Conduct internal audit
A common method of preventing financial crime is by performing an internal audit at frequent intervals, such as six months or one year from the date of the audit. In addition to checking your financial records, conducting internal audits will also guarantee that your company is not exposed to any hazards.
Be aware
Another strategy for preventing financial crimes is to keep an eye on clients' accounts and transactions. It enables the company to identify any unusual activity that has taken place and may give the company early warning signs of a financial threat. Additionally, perform a comprehensive due diligence investigation before making a purchase or starting a business with third parties. This tactic will offer you a comprehensive understanding of the company and its activities, allowing you to recognize any potential risks.
Comply with the laws and regulations
When you are doing business in a country, it is very important to comply with its laws and regulations. So, always make an effort to abide by state laws and regulations that are concerned with financial crime risks. In the event of a disruption, adherence to these rules and policies will protect the company and its reputation.
Reconcile the payroll statements
The best practice is usually to reconcile the payroll statements after a predetermined period and to designate someone from outside the company to oversee and completely assess the payroll system.
Conclusion
It is difficult to completely avoid financial fraud in your business, but it is not impossible. At every stage of your business, have a strategic approach to preventing fraudulent activities in all ways possible. In order to do business on the right track by complying with the accounting standard and the laws of the land, it is advisable to seek the help of leading accounting and auditing firms in the UAE, like Reyson Badger. With years of experience and a team of expert accountants and auditors, Reyson Badger can help you prevent financial fraud in your business.