How to Generate Business Profitability by Minimising Risk

It’s a sad fact that many businesses suffer financial losses and damage to their reputation due to organised, well-planned and even opportunist criminal activity.
Unfortunately criminals are becoming so skilled at this type of activity that companies can trade for years without knowing that they are being systematically attacked by not only individuals but also extremely professional criminal organisations.
That’s why we believe it is essential in today’s ever-changing and complex business environment that each area of your business activity is assessed in terms of particular types of threat such as:

• Theft


• Misappropriation of funds or assets


• Falsification of records for improper advantage


• Fraudulent administration of contracts

At BiB our aim is to help you manage and reduce your exposure to risk, specifically when it comes to the fraud and embezzlement arrangements for your business, helping you to minimise the risk you face from the effect of criminal activity.

So how can we reduce your exposure to this risk?

Unfortunately, it’s a common feature that many businesses often overlook the need for fraud and embezzlement planning to their cost. Effective fraud and embezzlement risk management looks at every possible impact on your business, examining activities such as electronic, internet or telephone banking systems, purchase procedures, password security, order processing and all potential areas which may expose you to significant risk.
Whatever your business, a well-planned review and assessment of your fraud and embezzlement programme is a proven and effective method designed to protect your valuable investment.
To give you some guidance on fraud and embezzlement risk management, we have put together an outline below of the main areas you should take into consideration in order to reduce your exposure to risk.

What you should consider?

We would recommend that you carry out a thorough examination of both your premises and operations, closely evaluating any areas which may leave you exposed to significant risk. This will highlight any areas which could cause problems to you and your staff, enabling you to:

• Identify the areas in most need of attention.


• Evaluate the scale of risk.


• Ensure that you have adequate arrangements in place.

Some important areas you need to consider when assessing your exposure to risk:

• Purchase of materials for construction or manufacturing processes.


• Purchase of vehicles, plant or machinery.


• Are any of the major purchasing decisions delegated to other staff?


• Does a single individual have sole control of accounting functions?


• Is there a system of checking to discover fraud or embezzlement?


• Is there benchmarking of gross profit and/or overheads operated?


• Do suppliers only accept orders against a validated purchase order?


• Are credit checks and specific references taken on staff who manage company finances?


• Is electronic, internet or telephone banking used?


• What is the nature of passwords used?


• Are passwords known to people not authorised to make payments?


• Are passwords recorded where they are accessible and recognisable?


• Do you change passwords periodically?


• Are payments received by credit card?


• Is order and authorisation of payment by the same person possible?


• What is the level of payment permitted by a sole signatory?


• Are there periodic checks on the legitimacy of orders, payments, suppliers and customers?

This is a brief overview of some of the issues that could affect your business to a greater or lesser degree, depending on how you manage them. We can help you examine these areas in a well-planned and detailed manner, identify your level of exposure to risk and develop an organised, cost-effective risk management plan.
All of which gives you greater control of your business performance, profitability and success.

What should I do now?

If you would like to find out more about managing the risks associated with fraud and embezzlement, then please call us on 01325 353888 and we will be happy to discuss this important issue with you in greater detail. Alternatively please email us on webenq@bibinsurance.co.uk