Employee Crime Poses a Significant Threat to Small Companies

Research conducted by the Chubb Group of Insurance Companies revealed that over 36 percent of private companies have been victims of an employee theft within the past five years.  The dollar value of these thefts has averaged nearly $350,000. The researchers also pointed out that more companies are facing similar situations as they reduce staff and make budget cuts. Both actions motivate employees to steal funds, equipment and inventory. 

The insurer reported in its 2005 Chubb Private Company Risk Survey, that 31 percent of companies polled plan to outsource some aspect of their operations, 21 percent plan to eliminate employees, and 20 percent plan to reduce or completely eliminate some employee benefits this year. These actions will be the catalyst for an increase in employee theft.

Larger companies are better equipped to absorb the financial impact of employee crime, but theft of this magnitude could spell financial disaster for a smaller company. Interestingly, the insurer’s research shows that in spite of the possibility of losing everything due to employee theft, more than two-thirds of private companies don’t have crime insurance.

To help small businesses identify and eliminate the potential for employee theft, Chubb is offering a booklet titled “A Guide to Workplace Fraud Prevention” on its website (www.chubb.com/businesses/chubb3331.html). KPMG Forensic developed the booklet. This unit of KPMG International is made up of employees with expertise in a variety of disciplines connected with fraud detection and investigation.

One of the recommendations the authors make is to start by developing an ethical corporate culture. Have a written code of ethics that incorporate the firm’s key ethical values and be sure it is communicated to employees. Many companies also require an annual written statement from every employee that they understand the code and are in complete compliance with it.

Along with the development of an ethics code, KPMG recommends that companies develop an effective fraud response plan that includes:

·   Limiting fraud opportunities by establishing strong internal controls and limiting overrides of those controls.

·   Managing pressures and incentives to steal that are inherent in the business process to the extent possible.

·   Focusing fraud detection and prevention efforts on risks where potential financial loss is the greatest or where cumulative losses from smaller frauds may be significant.

·   Fostering a strong “perception of detection” through proactive fraud identification, detection and investigation efforts.

·   Responding to identified fraud by consistently applying a “zero tolerance” policy.

Timing Is Everything When It Comes to Car Buying

You’ve been eyeing that new car for some time now, and finally your budget gives you the green light to go for it. So should you rush right out to the dealership? Only if you want to pay more than you should.

That’s because finding the best car deal is affected by when you purchase.  For the optimum bargaining position, the first thing you need to pay attention to is the time of the month. Both the dealership and its sales personnel have to meet monthly quotas. Shopping just before the month is about to end gives you more leverage because sales figures will soon be turned in for the month. A salesperson that has a slow month will be eager to make a deal to give those figures a last minute boost.

The second time factor that affects the deal is the season of the year. In early fall, dealerships are anticipating receiving inventories of next year’s models. To make room, they put remaining inventories of the current year’s models on sale. Typically this means taking significant markdowns so they can move the merchandise, which means big savings for you. The other seasonal advantage comes at Christmas time when shoppers are busy buying gifts, not cars. The light showroom traffic makes salespersons anxious to close the deal with a serious shopper.

Even the weather comes into play when you are trying to negotiate. Bad weather is another time when a dealer’s showroom will be empty. That leaves more time for a salesperson to try and make you happy enough to leave the lot the proud owner of a new car.

Of course, timing alone isn’t enough to put you in the driver’s seat without spending a fortune. You also need to do your homework and research prices before you set foot on any showroom floor. The Internet is the best place to find the information you need.

There are three web sites that you can use to research the dealer cost (invoice price), and the manufacturers suggested retail price (MSRP), or list price of the model you’re interested in:

1.   Kelley Blue Book (https://www.kbb.com)

2.   Edmunds (https://www.edmunds.com)

3.   MSN Autos (https://www.autos.msn.com/Default.aspx)

Always start your negotiations from the invoice price, not the MSRP.

You can also use Kelley Blue Book and Edmunds to find out what car buyers actually paid for the model in your region, based on your zip code. When you are using these sites to research a car model, don’t forget to use the “incentives” tab to see if the manufacturer is offering purchasers any kind of rebate. You can also find a full list of rebates on MSN Autos by logging on to https://autos.msn.com/home/rebates_all.aspx.