November 11th to 17th is International Fraud Awareness Week…...why should you care?
Posted 2012-11-16 by Shane Troyer
Despite the increased recognition that comes with International Fraud Awareness Week, many business executives and managers have little knowledge of the significant benefits that fraud awareness can bring to an organization’s ethical culture. At Breakwater our experience and research tells us that “fraud aware” employees can be your greatest tool to combat fraud and corruption in the workplace and beyond.
Organizations around the world, from large corporations or government entities to small businesses, lose an estimated 5% of annual revenues to fraudulent activities, according to a study conducted by the Association of Certified Fraud Examiners (ACFE). Of the frauds assessed, 42% of fraudsters were employees, 38% managers and 18% owner/executives. The ACFE study also identified that frauds last a median of 18 months prior to detection and that the most effective means of fraud detection by far (43%) are tips from employees of the victim organization.
Despite these statistics, many organizations continue to believe that fraud simply won’t happen to them, or that their auditors or financial controls will detect it. In most instances this is simply not the case.
A “fraud aware” organization will result in:
reduced likelihood of fraud;
more timely detection of fraud;
potential reductions in fines for non-compliance (where applicable) based on documented due diligence over staff awareness;
quicker reporting to those charged with governance; and
An open and honest dialogue within your organization about the risk of fraud, what fraud looks like, and how it is enabled will strengthen any internal control environment and act as a strong deterrent to any would be fraudster.
For more information on fraud awareness training please visit our website here.
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