7      Money and fraud

Successful businesses exist because

• they maintain a flow of cash, which means they can pay their bills
• they make a profit, which can either be paid to employees in bonuses or invested for future growth.

Managers are entrusted with keeping the company financially healthy. Money is created or spent in a number of ways

income from sales costs of sale general expenses of running business

losses or scrap (wasted resource) time of employees customers retained

What you can do to make the money go further

You will probably find that you have targets which you and your team need to meet. By meeting these targets you are doing your bit to help the company keep financially healthy. As you begin your job make sure you at least meet these targets. As you gain more experience you may find your manager asks you to review the way you and your team work so that you can achieve higher targets. This may include

higher productivity per hour or day buying more items out of the same budget getting more things right first time

less time on each customer transaction speeding up a process reducing or getting rid of overtime.

Team members often have ideas of how to save money – make time to listen carefully to them.

Fraud

Fraud is stealing. It is the easiest way for someone to end their career. The first point here is that you must never respond to the temptation to be involved in corporate fraud. If someone asks you to be part of it, speak with your line manager immediately.

How people defraud a company

Typical ways in which someone defrauds a company are:

• giving confidential company information to a competitor
• using company information for personal benefit
• taking equipment like stationery or components
• wasting company time which they are paid for
• absenting themselves from work for no acceptable reason.

Why people commit fraud

It can be for many reasons but two main reasons are

Financial

If you know or hear that someone in your team is in trouble financially, mention it to your manager. They will be able to have a conversation with them and if their work involves them dealing with money, can determine whether they need to be moved to another job where money is not a temptation.

Grudge against the company

A person may believe they are being treated unfairly by the company and fraudulent activity is their way of retaliation. You are more likely to find this out by having good working relationships with all your team. Then you will spot odd behaviour.

Line Manager's Guide

Half hour with your manager

1. How am I and my team spending or saving the company money?
   
   Review how your department or team is responsible for making or spending money. This is not only actual cash, but also the use of people’s time and maximising the usage of equipment. If you have not considered this for some while, you may find it useful to chat with your own line manager first to get your facts right.




2. How do my targets impact on the company’s financial performance?
   
   Look at the specific targets that your managers have to achieve. Show your managers how achieving, over-achieving or under-achieving them will impact the company’s finances.




3. Where am I wasting money?
   
   Review the team’s work and see if there are areas where there is
   • scrap
   • too much stationery/provisions in stock
   • not getting things right first time
   • people hanging around waiting for others to finish their work so they can get on with theirs
   • unnecessary walking/travelling from A to B when there is a shorter route
   • producing more than customers want.




4. How are ideas mentioned by the team considered?
   
   Talk about team meetings and individual conversations and the best ways you have found to encourage your team to give you ideas to improve the way you work.




5. What do I do if I think someone is defrauding the company? Give me some examples where it has happened.
   
   You should have guidelines from Personnel/HR on this, but generally encourage your managers to be alert to anything strange and to mention anything untoward to you immediately. Try and come up with a couple of examples that you have witnessed in companies where you have worked or that you have heard of. Use the examples on the page opposite to help jog your memory. These things do not often happen, but you must keep alert.

Line Manager's Guide