Keeping Sight of the Big Picture when it Comes to Fraud

By Pete Miller, CPA, CFE

Do you find that you sometimes get so bogged down in the details that you lose sight of the big picture? You know – not being able to see the forest for the trees.

If you find yourself in that situation, one way out would be to borrow a concept from Stephen Covey’s 7 Habits of Highly Effective People: take the time to “sharpen the saw”. Take time out to renew your focus. Don’t get so caught up in the details of a task that you don’t realize that a more important and sustainable solution may be at your fingertips.

Here’s how this concept applies to fraud. I recently had a conversation with a fellow fraud-fighting colleague. A client was resisting the notion of taking duties away from a key accounting employee who had concentrated responsibilities over nearly the entire cash management function of the company. Separating the duties will help protect the company from a possible fraud risk – cases such as the City of Dixon illustrate the wisdom of doing so. However, the client could only see inefficiency and frustration coming out of the proposed approach.

Their current approach may allow the cash to make it into the bank faster, but what if all the cash doesn’t get there? This is a fine time to step back from the trees and take the needed break to sharpen the saw so your tools can work better for you.

It makes me wonder if this client understands the tone-at-the-top concept and the strength and comfort that comes with support and encouragement of internal control. I totally understand that costs outweigh benefits at times. I do. If he/she can confidently answer the question, “How do I make sure all checks that come through the mail or are presented at the front desk, get deposited into the right bank account?”, then maybe these steps aren’t necessary. If he/she is counting on hope and the trust in his/her staff to make sure it happens, then that is a recipe for fraud risk and the pot is simmering to a boil.

© Clark Nuber PS and Focus on Fraud, 2016. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Clark Nuber PS and Focus on Fraud with appropriate and specific direction to the original content.

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