...Essay 5 Are you a victim of employee theft? Did you know that employee theft has cost from small businesses to major Fortune 500 companies over $37.14 billion in 2010 alone? Fraud against business includes the theft of physical assets such as cash or inventory. Essentially there are two types of inventory fraud: physical loss and financial statement fraud. Inventory shrinkage is the term use in accounting to describe the loss of inventory. Loss of inventory might be due to shoplifting, employee theft, damage, etc. Inventory fraud can occur in any company. Nearly 50% of retail inventory shrinkage comes from employee theft. Dr. Hollinger, who conducts the National Retail Security Survey, reported that shrinkage (as mentioned before) has cost the retail industry $37.14 billion in 2010. Shrinkage is divided into employee theft (43.7%), shoplifting (32.6%), administrative error (12.9%) and vendor fraud (5.4%). While is really hard for a manager or CFE to determine who can steal from a company you have to keep in mind that everyone with the right motives can steal from you. Even a longtime employee who has always been on time and loyal to the company may be tempted to commit theft due to recent live event such as a divorce, not enough money to send kids to college, etc. others do it simply because of greediness. I work for a mid-size property management company in Rockville, MD. The executive director, accountant and secretary where fired last month because they were stealing money...
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...Analogy Employee theft is very serious. Thirty percent of businesses fail because of employee theft (Kulas, McInnerney, DeMuth, & Jadwinski, 2007 as cited in Geesey & Rocha, 2012). The research also states the factors that affect employee theft to include the workplace environment, employee age, employee gender, and employee’s tendencies to steal. According to Moorthy, Seetharaman, Arokiasamy, & Marimuthu (2010), employees with a lower stake in a company have a higher tendency to steal. Teenage pregnancies occur due to various reasons some of which include social pressure, coerced sexual relations, and lack of information and availability of contraceptives (UNICEF, 2012). It is such a huge problem because of its ability to affect the growth of a community and the world at large. Poverty, reduced health, and maternal mortality result from teenage pregnancy (Gennari, 2013). The similarity between both employee theft and teenage pregnancy is a lack of self-control (Geesey & Rocha, 2012). “People committing crimes and analogous behaviors in adolescence and in adulthood start manifesting conduct problems early in life,” (Pratt & Cullen 2000, p.932 as cited in Geesey & Rocha, 2012). Employee theft in the past was largely ignored, however, it is now controlled and prevented through proper planning and execution (Geesey & Rocha, 2012). Small business owners and managers have been in charge of such planning and execution because of the impact...
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...7.7 Situation 1 Many employees pocket some of the tools for their personal use Quantities taken by one employee are immaterial individual employees do not consider the act as fraudulent or detrimental to the co Compare gross profit rates for industrial tools to the gross profit for personal tool Significant difference Event identified: Employee theft The possible causes • Low morale at the workplace. Whenever there is an employee starts pocketing some tools for their personal use, the others may follow. It has created a low-moral working environment within the company. • The consequences for theft are minimal. The company has no punitive procedures or policies regarding employee theft. If there are no set consequences to employee theft then employees will continue to steal, because they think that they won’t be punished. • Lack of control over inventory. It is easy to steal because the employer does not have preventive measures to stop them. Preventive measures are crucial to reducing the risk of employee theft. If preventive measures are not existent then the opportunity to steal is very high. The recommended actions to be taken: • Implement and communicate through proper training a policy regarding the theft of company goods and services and the repercussions associated with theft. • Allow employees to purchase tools at cost from the company. • Continue to compare the gross profit rates for industrial tools to the gross profit for personal tools...
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...and demands from customers, all of Company Q’s stores have now offers a limited amount of healthy and organic products, all of which are high profit items. It was suggested to Company Q by the area’s local food bank to donate day old food and goods and the board of directors declined. Company Q’s choice to throw away excess food rather than donate in fear of employee theft can be considered socially irresponsible. According to the USDA (2014), more food reaches landfills and incinerators than other materials in our everyday trash, making up twenty one percent of discarded municipal solid waste. According to Coleman-Jensen (2014), One in six people in America are facing hunger and forty nine million Americans are struggling to put food on the table daily. To know this information and still prefer to throw away goods is not only wasteful but socially irresponsible. Let’s examine what Company Q can do to amend their attitude toward being socially responsible. Company Q is concerned that if it begins to donate its excess goods to food banks then employee theft might increase. It is true that approximately 32% of thefts in retail are committed by employees. However, there are several measures Company Q can take to ensure that their employees do not steal the excess goods, but the following three will be the most beneficial. 1) Company Q can consider...
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...property entrusted to one’s care, custody, or control” (FBI, 2001). In other words, embezzlement is type of fraud where a person illegally takes money from an account he or she has given legal access to ranging from high-end bank employees to a cashier or waiter who pockets the money given from a customer to pay a check. This paper will discuss how embezzlement happens, some of the costs and statistics related to embezzlement in the United States, and, lastly, some of the current efforts companies and federal agencies are doing in order to stop or prevent embezzlement. Embezzlement is a non-violent crime; however, it is a serious crime that has much impact on its victims. A very important feature to distinguish embezzlement from other theft related crimes is the fact that some trust was violated between the owner of the money or property and the criminal who has stolen it. Embezzlers are “trust violators” who deprive their victims of economic benefits and of the ability to trust others financially (Crime and Justice, 1971: 247). One of the...
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...EST1 Task 1 Kara Kinikini Student ID: 265037 Business Management Many believe that business entities should have an ethical duty to be socially responsible, to work towards increasing its positive effects on society while decreasing its negative effects. Many organizations look for opportunities to be socially responsible while also creating shareholder wealth. Company Q is a small local grocery store chain located in a major metropolitan area. They have recently closed a couple of stores in higher-crime-rate areas of the city, reportedly because these two stores were consistently losing money. After years of requests from customers, all of their stores have started offering a very limited amount of health-conscience and organic products—all of which were high margin items. When asked by the area’s food bank for donation of day-old products, management declined deciding instead to throw the food away, citing worries over lost revenues due to possible fraud and stealing by employees who might say they are donating the food. Company Q's current decision to close stores in "Higher-crime-rate" areas of the city, was not a good exapmle of the social responsibility. The concept of social responsiility encompasses the actions, activities and attitudes of business and the impact a business has on its community. Closing those stores did not leave a possibive impact on the community, and other actions should have been taken to miminize negative impacts the community may have...
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...consecutively protect and identify these properties. Cheeseman stated that “Tangible properties have physical characteristics, such as building, goods, animals, and minerals” (Business Law, 2010, p. 739). Big retail stores like Wal-Mart, Best Buy, and Target suffers from theft and shoplifting on a daily basis in its daily operations. These thefts take in numerous forms, shoplifting of clothing from a department store, eating a grape from a grocery store, or purchasing stolen property is considered tangible. Theft of tangible property from any of these mentioned retailers is infringing on property rights. Retailers and grocery chains industries implement security measures to protect their profits and consumers, however; these measures cost the retailer industries millions of dollars in operation cost each year. Statistics figures from these companies states that “shoplifting occurs 330-440 million times per year at a loss of $10-13 billion dollars” (McGoey, 2011, p. 1). Additionally, retail giants like Wal-Mart, Target and Best Buy makes large investment to extend a comprehensive training of their managers and employees to protect its establishments from shoplifters and organize group that specializes in theft...
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...variety of reasons for doing so. It could be the employee feels the company may owe them something, there could be personal financial issues that the individual is dealing with, or maybe because they feel they are in a position to perform such an act and not get caught. Not all embezzlement cases involve an employee stealing money from a firm. There are some cases that involve employees having access to customers’ accounts in order to misappropriate funds to those accounts for a personal gain. In February 2014, an employee at Dover Downs Hotel and Casino was arrested for allegedly placing unauthorized credits on patrons’ player cards. Jane (whose name has been changed) had worked for the casino for two years. She became employed initially as a Line Cook and then later on, she was hired to work in the Capital Club department in August 2013. This department is responsible for issuing player cards to patrons. These cards serve as a means for customers to earn and redeem points. The ways for a customer to earn points is through playing the slot machines or having points physically placed on their card by a Capital Club representative. The points serve as cash, so for example, 1 point equals $1. The more points you earn, the more money you have to play with. During her employment with the department, Jane befriended two other patrons. They would come see her on a regular basis. This was not seen as an issue because each employee had their own customers that they have built a relationship...
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...the route that would lead to the biggest short-term profit. A. TRUST AND DUTIES - Some employees steal from the company’s customers. Sometimes a client or a customer may lose something of value or inadvertently leave something while on the company premises. Employees are required to return all lost items that a client or a customer has left while visiting the company- to the security department or to their manager immediately. If they choose to keep the item, it’s theft. When an employee steals from the customers it puts the company in an embarrassing position. - Some employees steal from their co-workers. Many employee-victims have complained and reported that personal property was taken from them while on the job. In some cases these issues are never solved. But in other cases the perpetrators of theft have been caught. This type of stealing is considered to be of a more serious offense and some individuals have lost their jobs because they were proven guilty of theft in the workplace. Sadly, some theft victims were unable to retrieve their items that were stolen. B. RESPONSIBILITIES TO SOCIETY -One of the key drawbacks to a corporate social responsibility program is the cost to the company. Efforts such as event sponsorship, charitable donations, product donations and commitment to voluntary environmental standards all cost money that a company is unlikely to make back in the short term. Despite the long-term positive effects of an improved corporate image,...
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...Shoplifting Prevention Prepared for Mrs. Walsh President Walsh Retail, Inc. Prepared by Ryan Kim, Kristina Stuckwisch, Doug McClure, Tyler Gunderson Accounting Department, Walsh Retail, Inc. November 20, 2012 WALSH RETAIL, INC. MEMORANDUM Date: November 20, 2012 KS RK DM TG KS RK DM TG To: Jessica Walsh, President From: Kristina Stuckwisch, Ryan Kim, Doug McClure, Tyler Gunderson Accounting Subject: Letter of Transmittal Dear Mrs. Walsh: The following report, requested by you in October of this year, examines reasons for shoplifting in an attempt to understand company losses. This study was undertaken with the intent of highlighting different methods of reducing shoplifting at Walsh Retail, Inc. The following topics are covered in the report: * Methods of reducing shoplifting in other companies * Statistics on the demographics of shoplifters * Items most likely to be shoplifted Research was conducted entirely online and only reputable internet sources were used. The entire research team is at your disposal should you wish to discuss our report at any time. Table of Contents Executive Summary……………………………………………………. Introduction……………………………………………………………. Background………………………………………………………………….. Body……………………………………………………………………… Why do people steal?…………………………………………… What are the characteristics of the shoplifters?…………………………………………… What items are most likely to be stolen?…………………………………………… ...
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...Decision Analysis Model and Report JaKaiser Smith Southern New Hampshire University Date: 07/09/2015 Abstract In this report following resources have been utilized to establish a relationship between Retail Salesperson’s salaries and their intent to shoplift at their own workplace: * The Larceny theft data from Federal Bureau of Investigation’s official website for the years 2011, 2012 and 2013; * 25th and 26th Annual Retail Theft Surveys by Hayes International for the years 2011, 2012 and 2013; * National Conference of State Legislatures website for Labor and employment data for the years 2011, 2012 and 2013. ‘Shoplifting’ is undoubtedly a psychological issue for most of the people. Shoplifting for most individuals is rarely about greed or poverty. It’s about people struggling with their own personal conflicts and needs. There are approximately 27 million shoplifters (or 1 in 11 people) in the USA today. More than 10 million people have been caught shoplifting in the last five years. The pleasure produced from “getting away with it” yields a chemical reaction causing in what shoplifters describe as an incredible “rush” or “high” feeling. Many shoplifters have committed to the fact that this high is their “true reward,” rather than the stolen product itself. It is assumed in this project that all the shoplifting instances in different states of the USA have been performed by the front-end Retail Salesperson. This might not be 100% true as the members...
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...Discuss employee theft, how employees steal from their employers, the different levels of employee theft and possible employers’ responses to employee theft. Employees theft continues to be a challenge for any employer in the US. For example, we can read in the National Retail Security Survey, 2013 (1) that “employee theft still constitutes the largest majority of losses at 43.9 percent or approximately $15.1 billion, followed by shoplifting, which makes up 35.7 percent of shrink or $12.3 billion.” Therefore, it is not a surprise that such huge losses are one of the biggest problems that employers are facing in the today’s economic environment or have always faced for that matter. Employee theft is manifesting in different ways but, somehow, a theft done by a low-level worker is almost always comes first to our minds when we hear about this form of white-collar crime. However, we should not forget that any person who is paid by an individual, an owner or a business is an employee by the definition; therefore, a highly paid manager or a CEO can also commit a theft. According to the book Trusted Criminals by David O. Friedrichs, page 114, “executives and managers are responsible for the largest proportion of losses business suffer at the hands of employees.” In the above-mentioned book we can read examples where lower level employees can embezzle significant sums of money or property. In one case, a Goldman Sachs secretary managed to embezzle at least $7 million by forging...
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...company’s effort to protect its assets from unauthorized use, robbery, embezzlement, and employee theft (Weygandt, Kimmel, & Kieso, 2008). Internal controls improve the reliability and accuracy of the accounting records by reducing mistakes and irregularities whether done purposefully or unintentionally. The principles of internal control are establishing responsibility, using physical, mechanical, and electronic controls, segregation of duties, and independent internal verification (Weygandt, Kimmel, & Kieso, 2008). The principles of internal control establishes responsibility by assigning one employee to a specific task so a company can easily monitor record keeping in order to reduce errors and minimize abuse (Weygandt, Kimmel, & Kieso, 2008). Physical controls such as safes, vaults, locked storage cabinets, and computer facilities that require pass keys or fingerprint scans limits access and pinpoints responsibility to a small select group people (Weygandt, Kimmel, & Kieso, 2008). Mechanical and electronic controls such as alarms, video surveillance, and employee time clocks, reduces break-ins, deters theft, and prevents unauthorized overtime hours by safeguarding company assets and improving the accuracy and consistency of accounting records (Weygandt, Kimmel, & Kieso, 2008). Segregate duties by assigning different individuals to related responsibilities in a company. One employee is responsible for the record keeping of a particular asset, and another is responsible...
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...Human resource management Carter Cleaning Company1 1. What would you do first if you were Jennifer? If I was Jennifer, I would have done the following things: -First thing, I would get information about the workforce, the employees, their situation and specific skills they have. I would try to find their motivations and their concerns in order to build a stronger relationship between them and my company. This first step must be develop during recruiting (one and one meeting) where I would have an overview about an applicant and see if he or she fits with the company’s goals. But Jenifer needs also to train them since her father wants the employees to do more different tasks. -Then I will set up a promotion plan so that employees’ motivation would be increase by working harder for their company. The issue is simple here; Tiffany has to deal with unskilled and unmotivated workforce who doesn’t really care about their job. So I would try to get them more involved by praising and compensating them. I would rather raise their salaries a bit more to keep them than doing many interviews that waste both time and money. -Last but not least, I would consider my employees as workers who add value to my company and service I provide and certainly not as “cost or adding charges”. This has to be one of the main matters of a human resource manager, about how to increase the employees’ value through management. I would provide to my employees clear data about the company in order...
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...Stealing is the unjust violation of another’s right to property, acquire, possess, enjoy and retain goods. Theft is an injury to God and to man, but becomes minor when done slightly (stealing from the rich), but when done intentionally and continuously, they become serious sins. 1. Taking of what belongs to others (pickpockets, sneak thieves, fraud and cheating…) 2. Keeping of what belongs to others (refusing to pay debts…) 3. Damage to one’s property (when a person through his own fault causes loss to another …) *theft - To take anything private from a private individual *peculation - from the public *man-stealing - To enslave a freeman or appropriate the slave of another *sacrilege – stealing anything sacred Thefts done by… Employee – taking things home, faking record, wasting time… Employer – underpaying workers, treating workers badly Ethics – borrowing and not returning, not paying debts *when we are obliged to do something, we must do it. When we don’t, we have stolen. The idea that a man can steal from God can be done in 4 ways: Tithe – using church donations for personal benefit Time – wasting time, instead of using it for the glory of God Titles – trying to exercise control over our own lives Talents – failing to exercise God’s gifts and talents You shall not steal A. Stealing is taking what belongs to another. B. Includes more than the outright taking 1. Exodus 21:16 - Kidnaping...
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