Article
Prevent and detect fraud with these key internal controls
April 25, 2023 · Authored by Chelsea Ritchie, Tammy Lohr
Internal controls are key to preventing and detecting fraud and for establishing anti-fraud programs. In fact, the 2022 Association of Certified Fraud Examiners (ACFE) Report to the Nation indicates that 29% of fraud cases reviewed were perpetuated by not having adequate internal controls.
The financial loss and reputational damage that comes with fraud can have an especially great impact on public sector organizations that rely on taxpayer or philanthropic dollars.
How can internal controls help with fraud prevention?
Internal controls provide checks and balances that help protect an organization from internal threats and help prevent fraud by reducing the opportunity to commit it. These fraud-preventative controls serve as the first line of defense, but they can also continue to detect fraud in a time-efficient manner, ultimately reducing losses. When these controls uncover fraud after the event, the organization can then take the appropriate action to safeguard its assets.
There are many key examples of powerful internal controls, as further detailed below.
