Why Business Owners Should Embrace Effective Internal Controls

Internal controls are the backbone of any small business, whether it’s a doctor’s office or a retail operation. Without them, your business cannot function effectively or profitably.

Here’s what the Association of Certified Fraud Examiners (ACFE) found in their 2014 Report to the Nation on Occupational Fraud & Abuse:

  • The median loss caused by fraud was $145,000
  • 22% of cases lost at least $1 million
  • 85% of cases dealt with asset misappropriations
  • 39% of cases were corruption schemes
  • 9% of cases dealt with financial statement fraud

Additionally, the ACFE noted that smaller businesses (less than 100 employees) tend to suffer disproportionately large losses compared to larger companies. Employees committed 42 percent of frauds. Collusion – more than one perpetrator – resulted in the largest losses.

The good news is that organizations with internal controls fair better than those without. Here are three ways to ensure internal controls are effective in your small business. 

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4 Keys to Working in Harmony with a Business Partner

Increase Employee Engagement

When you work solo in business, you aren’t required to run things by anyone. However, if you have a business partner, that all changes. Therefore, it is critical for the health of your business that you and your business partner are working in lock-step. Here are four keys to working in harmony with a business partner.

1. Make a mutual decision regarding responsibilities. For example, you may be better suited to handle sales and marketing, while your business partner prefers an operations role. Clearly-defined responsibilities help to avoid conflicts and make the business run more efficiently.

2. Hold an off-site “check-in” meeting at least every two weeks. This meeting could simply consist of having lunch or dinner together to discuss current events in the business. The reason to hold the meeting “off-site” is that an outside venue can provide a more relaxed environment for discussion.

3. Don’t fear the tough conversations. The best business partnerships are based on open and honest communication. There will be tough conversations in business. Some of these conversations will be about performance; others will be about money. If you don’t tell your business partner what’s on your mind, it will lead to animosity down the road.

4. Collaborate with your business partner. Don’t just come in the office and go your separate ways. Instead, find a project you can work on together. Solving challenges together provides a feeling of satisfaction and strengthens your bond. Collaboration fosters trust and makes stronger business partners.

Remember, running a business successfully does not need to be complicated.  Keep it simple!

For more valuable articles to help you successfully manage the challenges of growing your business profitably, please search our blog at our website www.portalcfo.com.

 

Business Analysis – 5 Critical Areas in your Business to Analyze

analysis

There are many reasons for a company to conduct a business analysis on itself. These reasons should include everything from gathering data to managing it. It’s a project that needs to have its findings put into a readable format. A business analysis will illustrate the successful areas of the company, provide a path to increased success, as well as plan for the future.  Here are five critical areas to focus your business analysis on for maximum benefit.

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How Business Analysis Makes Your Business Better

No matter what type of business you run, you have to keep up with the changing demands of your customers. Processes that have worked for the last five years may continue to provide some potential for growth, but it is important to understand that stagnation will never provide an increase in profits. Whether you know for certain that change is needed, or you simply want to gain a better understanding of your options as a business owner, a comprehensive Business Analysis is the best place to start.

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Do I Need Business Coaching for My Small Business?

Having a coach in your corner won’t ensure you victory, but there is something to be said about having a guide when you encounter obstacles and challenges. A coach does more than tell you to “be the ball.” He helps you navigate the opposition, achieve goals, and hone your skills for better performance. You expect a coach on the sideline during a game, but do you really need business coaching for a small business? What are the benefits of working with a business coach?

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