But what financial controls can you implement that are relevant for your small business?
Having a safe or a file cabinet that locks is good for keeping items such as your businesses checkbook, cash or check receipts from clients or items such as your credit/debit card processing attachments that plug into your phone or tablet. It is also good to keep documents that may have sensitive information like your bank account number or your card number.
Documentation is important. Keep receipts and deposit slips and always compare to bank statements or review your accounts online. This ensures that you catch any discrepancies in deposits that are posted and that you catch any fraud on your account before it causes too much damage. Reviewing your accounts at least twice a month is a good idea.
Deposits should be taken once or twice a day. If you should receive additional client payments after a deposit run or receive them late in the day, place them in the safe or locking file cabinet. This ensures that cash or checks are not lying around or on your person which could endanger your safety.
Information security, this is new but just as important. Make sure to use strong passwords for online accounts like banking or credit card. (You should have strong passwords for all of your online accounts) Do not write down passwords and leave them at your computer (like under your keyboard). Use password housing applications and software to store that information. This will help since you will only need to remember one password. Never click on links from emails stating you need to reset your password, these are phishing emails. If you have any concerns always type the web address of your financial institution and access your accounts from there.
As your small business grows you can add additional actions, like separation of duties and securing your private network. Increasing reviews and audits also becomes important as your grow since fraud is harder to spot when there is more activity in accounts.
While these are just a few actions you can take, they are important and will lay the foundation and create the culture your small business needs to ensure that you have strong financial controls now and in the future.
Thanks for your interest and we hope to continue to have meaningful conversations.