- February 5, 2024
- Posted by: floresfinancial
- Categories: Accounting, Human Resources
Accounting is just about numbers and HR is just about people, right? Guess again. In this week’s episode of FLORES Solutions, FLORES COO/VP Michelle Flores-Gonzales and Chief HRCS Officer Mia Arnesano discuss the benefits employers and employees can experience with an aligned accounting and HR strategy, such as:
- Optimized employee benefit and salary packages
- Accurate reporting of payroll expenses, benefits, and deductions
- Streamlined, uniform, and efficient business processes
Check out more FLORES Solutions videos to learn more about best practices for business efficiency. Please contact our team to learn how to outsource your accounting and HR with professional, accurate services that keep you in compliance.
Mia Arnesano (00:05):
Hello everyone. Welcome to another edition of FLORES Solutions. I’m Mia Arnesano, Chief HRCS Officer at FLORES, and here with me is Michelle Flores Gonzalez, COO at FLORES. So today we’ll talk about fraud in accounting and HR and how to prevent it. So Michelle, with the rise of digital technology, AI, and increased access to sensitive information, HR and accounting fraud has become more prevalent, right? So business owners should be aware and concerned, of course, about fraudsters, cameras, data theft and identity theft, and even company theft—mainly from the HR department, payroll department, and employee information systems. So with that said, based on your experience, can you tell me some typical scenarios of fraud in HR and accounting?
Michelle Flores-Gonzales (01:05):
Absolutely, yes. Thank you, Mia. Yeah, fraud is definitely something all business owners and employees should be aware of. It is prevalent, more prevalent than we all would hope, but some typical scenarios you might see are employee impersonation, false identification, where they go to apply for a job using false payroll data, and also submitting forged documents such as vendor theft or vendor fraud. Some of the most common types are obviously payroll fraud, workers’ comp fraud, and then accounting fraud—the illegal alteration of a company’s financial statements to manipulate a company’s appearance to hide profits and losses. So overstating revenue, failing to record expenses, misstating assets and liabilities—all of those are ways in which your company can be subject to fraud. So it’s really key that our employees are educated and our business owners are savvy on ways to prevent such fraud.
Mia Arnesano (02:10):
That sounds like a very, very high risk and can create panic in businesses. I’m sure there’s so much more information in regard to that. But every problem—every HR, accounting, or business problem—has a FLORES solution, right? So what steps can you tell our viewers on how to prevent fraud?
Michelle Flores-Gonzales (02:39):
Yes, absolutely. So here at FLORES, we go over fraud very diligently with our team members as well as with our clients because we want to be proactive and prevent as much fraud as possible. So here’s some key things to do. First, be sure to be thorough in explaining the types of fraud that can be committed against your employees and against your company. And also be sure to explain disciplinary action if people violate your fraud policies. Second, be sure to do background checks on all employees, your contractors and your vendors because you just don’t know, right? Business owners, HR professionals, and even managers need to do their due diligence before granting someone access to your personal company data, especially when you’re talking about things like payroll data or employee personnel files. Last, you want to make sure you are creating a culture of transparency and accountability. You want to encourage employees to report any types of issues, even if they’re not sure it’s a fraud issue. If there’s even the slightest hint of a red flag, always ask because fraudsters are getting more and more savvy, and it’s quite possible for employees to get fooled. So when in doubt, ask. By taking these steps, companies can significantly reduce their exposure to fraud in HR and accounting and be on the right side of the ship.
Mia Arnesano (04:10):
Wonderful. Thank you so much for that insightful and very beneficial information. So there you have it—scammers and fraudsters are getting smarter but your FLORES team can definitely help you outsmart them. So make sure you know all of this information in regard to fraud prevention and how to be aware and prevent fraud.