Family Businesses, Family Offices, Nonprofits, and Professional Practices
“Risk is like fire: If controlled it will help you; if uncontrolled it will rise up and destroy you.”
- Theodore Roosevelt
It is estimated that embezzlement and fraud contribute to approximately 30% of small and mid-size business ("SMB") failures.
Whether you have hundreds of permanent employees and a fully staffed accounting department or only a few employees, any organization could become a victim of fraud or embezzlement of cash or other financial assets. The risks today come from employees, customers and vendors, business partners and increasingly from cyber threats.
Wealth-Check for Business and Organizations
The Association of Certified Fraud Examiners (“ACFE") 2016 Report to the Nations identified asset misappropriation, particularly fraud and embezzlement, as one of the most significant risks to businesses and organizations. Both the ACFE report and a 2017 study by Hiscox Insurance found that the frequency and significance of asset misappropriation correlated to whether or not there were processes and controls in place to mitigate the risks. Lack of controls led to longer lasting embezzlement or fraud and double the average loss.
Considering the seriousness of the risks of embezzlement and fraud, leadership of all organizations would be well served to identify the risks and assess how they apply to your organization, rather than assuming these issues only occur elsewhere.
FirstRule Financial has developed Wealth-Check for Business and Organizations, a proprietary risk assessment methodology focused on the risks of misappropriation of cash or other financial assets. Using the findings from Wealth-Check, we work with management to implement or remediate relevant policies, processes and controls.