Please, respond to the below classmate discussion posts. (125 words each)
The response is not an evaluation of their discussion posts. You must agree with their post and add new information on your response regarding the topic in discussion. (No citation needed)
Thank you
Discussion 1
Candence Kitchen
1. Internal controls such as separation of duties, redundancy, and centralized process discourage employees from committing fraudulent acts in a variety of ways. According to John Ivancevich, separation of duties whenever the employees handle money: If one employee invoices and authorizes payment then a second employee should write and send the check, and another employee should reconcile the bank. Secondly, redundancy allows more than one person look at the same transaction. Checks should be cosigned rather than one authorized person. Multiple employees should have the responsibility for overseeing specific bank accounts preventing one employee from lapping or moving funds from account to account ahead of any audit so that no i
egularities are detected. Lastly, centralized processes allow tighter control. When procurement is centralized, employees in in satellite offices are not able to buy more than needed and then resell or return items for cash. When inventory is centralized, employees know that the company’s assets are tracked and monitored. (Ivancevich, J., Konopaske, R. 2011).
2. Small businesses are more susceptible to employee fraud and theft due to limited resources. Larger companies have the resources and personnel to separate duties, whereas as a smaller business does not have the manpower to commit three people invoice, write, send check, and reconcile. The small businesses have one person completing these tasks.
3. An organization can encourage honest employees to report fraudulent behaviors by creating an ethical workplace from the first step into the door. “An ethically adequate workplace culture will leverage such essential tools as onboarding, performance and promotion procedures, role modeling, communications, and employee feedback to build ethics into its operations” (Olson, Steven., XXXXXXXXXXKeeping that in mind, organizational leaders can ensure to
idge the gaps between processes at the beginning stages of hiring to ensure those standards are set. A Dallas based mechanical construction firm communicates ethical values from the start. Their employees-or “partners” as they are called receive their picture on the wall lined up, evaluate management according to criteria centered around the firms values, leaders bid on construction projects based on the potential impact on partners’ careers, and when a project is completed the company hosts a party for all the partners and their families at the newly constructed facility so they can showcase the workmanship to their friends and families (Olson, Steven. 2013). Care costs very little. Respect costs even less. Care and respect empower an employee’s attitude toward an organization. Ethical behaviors start from the beginning and are intertwined in every process the company owns.
4. It is vital for a company to have a code of conduct that defines fraudulent behavior for three reasons according to ECI. The three reasons are compliance, marketing, and risk mitigation. Legislation requires individuals serving on boards and organizational leaders to implement codes or explain why they have not. Secondly, when there is a code in place it stands as a public statement of what the company stands for, the commitment to higher standards and ethical conduct. Lastly, risk mitigation. Organizations with codes of ethics, and who follow other defined steps in the U.S. Sentencing Commission’s Federal Sentencing Guidelines, can reduce the financial risks associated with government fines for ethical misconduct by demonstrating they have made a “good faith effort” to prevent illegal acts. (Ethics.org)
References
Ethics.org XXXXXXXXXXWhy Have a Code of Conduct. Ethics & Compliance Initiative. Retrieved from: https:
www.ethics.org
esources/free-toolkit/code-of-conduct
Ivancevich, John., Konopaske, Robert XXXXXXXXXXHuman resource Management. Twelfth edition. McGraw-Hill Irwin.
Olson, Steven D XXXXXXXXXXSHRM’s Foundation’s and Effective Practice Guideline Series. “Shaping an Ethical Workplace. SHRM.ORG. Retrieved from: https:
www.shrm.org/hr-today/trends-and-forecasting/special-reports-and-expert-views/Documents/Ethical-Workplace-Culture.pdf
Discussion 2
Mariah Vazquez
According to Ivancevich and Konopaske (2013), internal controls are vital in discouraging employees, clients, and vendors from committing fraudulent acts. Internal controls help companies detect fraudulent activity and evaluate whether said employees, clients, and vendors fulfill their duties. While internal controls are not the only tools companies can use to prevent theft and fraud, they help determine the causes of losses and the impact on their perform.
Small businesses are more susceptible to fraud and theft because they tend to have limited resources. According to the Association of Certified Fraud Examiners (ACFE) (2010), small companies also have fewer internal controls and other cost-effective mechanisms, such as hotlines and ethics policies, that set the culture of the company. Because they lack internal controls and other prevention measures, small businesses tend to experience a higher percentage of losses when fraud and theft occur.
Despite how the problem severely impacts smaller companies, the ACFE XXXXXXXXXXnoted that employee tips help detect occupational fraud. Thus, any size company may rely on internal and external tips when knowing that they can report incidents without fear of reprisal. While most businesses tend to rely heavily on audits, those that depend on tips must provide the training needed to sustain an ethical culture.
All companies must have a code of conduct defining fraudulent behavior in place to determine which employees will most likely steal company assets for personal gain (Association of Certified Fraud Examiners, 2010; Ivancevich & Konopaske, XXXXXXXXXXA code of conduct ensures that employees accused of engaging in fraudulent behavior will receive fair treatment. Also, the code of conduct will allow employees to observe the consequences of committing theft and fraud. Without a code of conduct, many companies, especially small ones, will incur significant losses that could go undetected until it is too late. Ultimately, a code of conduct provides employees with the confidence needed to maintain retention rates.
References
Association of Certified Fraud Examiners. (2010). Report To the Nations on Occupational Fraud and Abuse. https:
www.acfe.com/uploadedFiles/ACFE_Website/Content/documents
ttn-2010.pdf
Ivancevich, J. M., & Konopaske, R. (2013). Human Resource Management (12th ed.). New York, NY: McGraw-Hill Irwin.