What you don’t know could destroy your banking structure.
The financial services industry continues to undergo major disruption, but disruption must be balanced with caution when it comes to digital banking.
In today’s digital age, cyber security has become more crucial for companies, no matter the size. Due to the rise of hackers and identity thefts, the stakes are higher than ever with technology being such a large part of how our society operates. In many cases, these technologies are essentially the core operations of the business. For example, banking now lives in the digital platform, meaning that all the risk of fraud and theft is very relevant to these aspects. There are many different techniques that you should practice in order to prevent being stolen from. So, here are some of the things that every CFO should be wary of and abstain in order to avoid the dangers of digital banking.
Forgetting to Review Your Statements
It is important to review your transactions every month. If this information is sent to you via a monthly statement, it’s important that you secure this information in a very safe place. One thing you absolutely would want to avoid is leaving statements in open places where it would be easy to steal from. For example, if you receive this information in the mail, you should not leave it out on your desk unopened and unattended. You should spend a few minutes each month reviewing your statements to ensure that the transactions don’t seem suspicious and unusual. Be sure to receive this information in a very safe encrypted medium to prevent any stolen information.
Not Holding Your Controller Accountable
One thing that you should be wary of is that a lot of times the employee who is processing payroll is also the same person seeing the payroll reports, meaning that your controller’s work should be reviewed. You should consider creating a monthly review with your controller to ensure that the numbers align and that your employees aren’t sneaking any bonuses under your nose. With that being said, you should never have one person take care of all the finances. Create a checks and balance system to ensure that numbers align to prevent any future problems.
Neglecting Insurance Deductions
If your business offers any benefits for your employees where they contribute to the cost such as health insurance coverage, you should be wary of the fraud risk present. These instances require two separate transactions. The first is when your business pays for the benefits and the other is when the cost is expensed through the employee’s pay. You should keep a close eye on these calculations to ensure that employees aren’t leaving you with all of the costs.
Failing to Review Statement of Cash Flows
You need to review your statements of cash flows monthly to help detect fraud. One tip is to survey for changes in beginning cash balances of prior months or years. There are times when hackers have tried to hide entries in the system by implementing the changes in prior months or years, hoping that no one would look back that far. To prevent this, you should make sure that you keep these historical records intact.