Looking at what stands out.
WHY IT MATTERS
Most problems appear as something unusual before they appear as a loss.
WHAT TO REVIEW REGULARLY
Transactions above a threshold Manual journal entries Credit notes and refunds Write-offs Payments to new suppliers Payments to individuals Round-number transactions Transactions just below approval limits Transactions outside normal hours
WHY MANUAL JOURNAL ENTRIES SPECIFICALLY
They bypass normal processing and they are how records are adjusted.
WHAT TO REQUIRE
Explanation and approval for every manual entry.
WHAT TO ESTABLISH
Who may post them.
WHY ROUND NUMBERS
Genuine transactions are rarely round, and fabricated ones frequently are.
WHAT TO ASK ABOUT ANY EXCEPTION
What it is, who authorised it, and whether the explanation is supported.
WHY SUPPORTED
Plausible explanations are the point of concealment.
WHAT TO ESTABLISH
That explanations are verified, not just accepted.
WHAT COMPARISON REVEALS
Trends inconsistent with activity Costs rising without a reason Margins falling Ratios changing
WHAT TO COMPARE
This period against prior periods Actual against expected One location or person against another
WHY BETWEEN LOCATIONS
Differences between similar operations indicate something specific.
WHAT TO INVESTIGATE
Anything you cannot explain.
WHY
Unexplained variances are either errors or losses, and both matter.
WHAT TO AVOID
Accepting the first explanation offered.
WHAT TO DOCUMENT
What was reviewed and what was found.
