4/29/2015. Presented by: Dr. Michele Moore. Communication is instant Any issues will be: On news In newspaper ALL OVER FACEBOOK & TWITTER

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1 Presented by: Dr. Michele Moore Superintendent at the MSD of Martinsville School of 5000 students Previously Executive Director at Central Indiana Educational Service Center CFO at Central Indiana Educational Service Center Classroom Teacher CPA Owner of Moore Accounting and Consulting Auditor for Indiana State Board of Accounts Communication is instant Any issues will be: On news In newspaper ALL OVER FACEBOOK & TWITTER It s not a question of if it s a question of when! Prepare for it by Developing Policies & Procedures Not making your place a temptation! Creating Checks and & Balances Having segregation of duties 1

2 $1.2 million in false expenses Security expert finds and exploits $1 million hole in company s internal controls A suspiciously long case of jury duty Lots of company property goes missing Who counts coins anyway? IKEA worker nets $400K in refunds Bookkeeper swipes $350K from bookstore Source: July 2009 Financial Need Gambling debt, divorce, medical issues, high life style, excessive credit cards Opportunity to Steal No checks and balances, little oversight, opportunity to do so Employee Justification Feels make too little pay anyway Feels under appreciated Feels over worked Feels they are Due Feels that it won t hurt anyone U.S. businesses lose 5% of their revenue each year to employee fraud. The report places the median loss caused by the occupational fraud cases in our study was $140,000. More than one-fifth of these cases caused losses of at least $1 million Source: 2012 Report to the Nation on Occupational Fraud and Abuse 2

3 Formalize the expectations Make the practice consistent between buildings Everyone should be on the same page Work with your staff to develop administrative guidelines that are written down Communicate those expectations to staff both orally and in writing Have procedures in place for: Hiring staff Terminating staff Handling leaves and vacations for staff Safety plans including procedures for worker s comp claims Cross train staff All jobs should have more than one person trained to do the job Good communication will be the key in implementing policies and procedures Tell all staff initially when rolling out a new policy. Do this first in a meeting and then follow up with an or letter Then wait and remind them again that there is a new policy and why you re doing it Finally, after you have implemented tell them that you told them about the change and remind them why it was necessary and that it has improved practice. 3

4 Do you allow one person to count cash registers without a back up tape? How do you inventory food? How do you allow employees to clock in/out or record their time worked? How do you process Free/Reduced applications? How do you handle dummy control accounts for students? All of these areas of areas of possible theft One is nice, but two is best! Always try to get one person to check another s work. Get two signatures on cash counts or one person to count and another to verify Make sure that time clocks are in a central location and that you don t allow employees to clock in for each other. Don t allow employees to forgo vacation time. Everyone needs a back up and a break Don t let one person control the entire process Separate invoicing from cash management from accounts receivables from bank reconciliation Have spot checks on free/reduced lunch applications Have spot checks on food inventory 4

5 Pay careful attention to any employee s request that deviates from the policy Sometimes you can t be nice you must stay professional Example: Ethical Dilemma Sarah s daughter is sick and she is out of sick days. She wants to get paid, but not be there. She asks you to be nice and let her leave early so she can take care of her sick child and you adjust her time. What is your response? Don t get in the habit of borrowing things. Blurs lines of professionalism Includes: tables, chairs, equipment Makes it easier to translate to borrowing money I need the cash for just a few days until I get paid. The few days become weeks and then malfeasance occurs. Vendors want to own you Be careful about: Accepting free stuff (dinners, ball games, gifts, clothing, etc.) Keep track of the dollar amounts ethically you need to be very careful one dinner might be ok, but five dinners and Pacer tickets crosses the line. Never let them buy you alcohol with a meal. Token gifts such as coffee mugs are much different than laptops. Set a limit I use $25 limit. If it s a meal at an IASBO conference and several schools will be there might be ok. Your gifts will be observed by someone don t lose your integrity you can t get it back. 5

6 Remember that any recommendation you make to the school board should be made based on competitive bidding process including RFP and quotes. Avoid extending contracts Get three quotes Document, Document, Document Your reputation goes on the line everything you recommend a vendor You need to ask yourself continually, How could I steal money.. with this procedure? Play devil s advocate and try to find the gaps in your procedures or where weaknesses are Don t be afraid to talk to other districts to see how they handle certain events Get a good support group both inside or outside the district. You will need people to talk to. Never ask anyone to do anything that you are not willing to do yourself Never ask anyone to compromise on an ethical issue When meeting over a difficult HR issue, meet as a group with you and another person. Try not to meet with the person you are terminating alone if there is reason think it will be an issue. 6

7 The best leader is the one who has sense enough to pick good men to do what he wants done, and the self-restraint to keep from meddling with them while they do it. -Theodore Roosevelt Surround yourself with great people and then leave them alone! Example is not the main thing in influencing others, it is the only thing. -Albert Schweitzer You every action is looked at you do work under a microscope. Set the example. Management is doing things right; leadership is doing the right things. Peter F. Drucker, Essential Drucker: Management, the Individual and Society Management is process Leadership is empowering others in process Just because you can do it, doesn t mean your organization should. 7

8 Drug & Alcohol Policy Nepotism Policy Requirement to take vacation leave Handling cash Hiring employees Evaluating employees Job descriptions Jane fell at work and hurt her back. She can t come back to the cafeteria for an extended period of time she says. What do you do? Bob refuses to ever take a vacation. He is the most loyal of employees. He just loves his job. Carol s daughter is graduating from high school and she needs to borrow the punchbowl from the cafeteria. She forgets to return it and then keeps it for her other daughter s wedding in three months. Tim starts his own company called McFarlane Foods. The cafeteria starts receiving invoices from this company instead of the usual vendor McFarling Foods. Being responsible sometimes means pissing people off. Colin Powell, On Leadership You need to realize that in leadership positions, you won t be popular. 8