Preventing fraud should be part of the business process of any organisation for several key reasons:
💰 Financial Stability: According to the Report to the Nations published by the ACFE, any organisations would lose around 5 % of revenue to fraud each year. Particularly, in small organisations financial resources are carefully budgeted and any loss due to fraud can significantly impact their ability to grow and compete. By preventing fraud, the resources of your organisation are protected and available for business development.
💸 Access to Funding: One of the benefits to prevent fraud is easier access to funding. Indeed, potential investors will feel secure investing in your organisation.
🫂 Reputation and Trust: Organisations rely heavily on their reputation and the trust of their customers, suppliers, and partners. Fraud can damage this trust, leading to loss of clients and business opportunities, which could be hard to recover.
📑 Legal and Regulatory Compliance: In the UK, businesses are required to comply with laws such as Bribery Act 2010, the Modern Slavery Act 2015, the forthcoming into force ECCTA. Failure to prevent fraud could lead to fines and penalties. Additionally, organisations and Directors may be held responsible for failing to take adequate steps to prevent fraud.
🚂 Employee Ethics: If fraud occurs within the organisation and is not addressed effectively, employees are less likely to blossom and stay in their roles or trust leadership. But with a compliance program in place setting clear policies and procedures, employees would feel more comfortable, they know what the rules are. In addition, as a director, you have a strong baseline to control.
In short, fraud prevention ensures the longevity, growth, and overall success of any organisations in the UK. It protects financial resources, enhances trust, ensures legal compliance, and promotes a positive work environment.
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