Cash flow is king. Is your bank account reconciled? WHY NOT! There is a SIGNIFICANT amount of employee fraud, especially at small to medium sized companies that could be COMPLETELY avoided if you knew one secret thing. What is that secret thing? It will absolutely astound you when I reveal it. But first, you really need to follow your cash. Start with Accounts Receivable. Do you recognize EVERY customer on the list? Does your sales team? If not, you better find out. It is easy to create a false customer to funnel legitimate cash receipts thru and “balance everything out.” You need to know why AR is going up and down. It is no different than expenses. Next up is inventory. Engineering should know why every part is there and why the quantities of each are going up or down. Same with the production team. Are you using ABC to track usage of inventory? How about cycle counts? Now move on to Accounts Payable. Your purchasing team needs to know EVERY vendor and what they are used for. It is easy to create false vendor and cut checks to pay them. If you keep track of AR, Inventory, and AP closely, and manage the level of each, your cash flow will be in fairly good shape. Now on to the secret fraud prevention tip. Are you ready for this? Here it is. Look at your bank statement EVERY MONTH WITHOUT FAIL and understand it.