What reports should you be reviewing regularly to identify irregularities?
Whether you work in the company daily or manage from afar, there are key reports you should be reviewing regularly to stay informed and detect possible fraud.
Below is a discussion of the key reports you should be reviewing regularly as part of your internal controls:
- Accounts Receivable Summary: This report provides you with the amounts owed to the company by each of your customers. You should be reviewing this regularly to ensure that receipts are recorded and applied correctly and to follow up on overdue accounts.
- Accounts Payable Summary: This report provides you with the amounts your company owes to vendors. You should be reviewing this regularly to ensure the vendors listed are valid and that payments you have made on these accounts are correctly applied.
- Income Statement: This report provides you with a summary of the sales and expenses incurred during a period. You should review this report regularly and compare it to the prior period to look for irregularities. Are the wages comparable to the prior period? Is the gross margin comparable to the prior period?
- Payroll report: This report should be reviewed each pay period to ensure the employees being paid were all working for the company that period and the hours and wages are all accurate.
Reviewing the above reports each period will help you identify irregularities and detect fraud.
Dawn Loeffler, BA (Hons), CPA, CA
Manager, Gilmour Group CPA’s
Disclaimer: The information contained in this article is intended solely to provide general guidance on matters of interest for the personal use of the reader, who accepts full responsibility for its use. While we have made every attempt to ensure the information contained in this article has been obtained from reliable sources and accurately described herein. SW Media Group and Gilmour Group Incorporated is not responsible for any errors or omissions, or for the results obtained from the use of this information. Before taking any action that might affect your personal and business finances, you should consult a qualified professional advisor.