7 tips to avoid embezzlement

By Donald P. Lewis Jr., DDS, CFE

Diversification of duties — This is the most important internal control in attempting to avoid becoming a victim of embezzlement in your practice. It allows for financial diversification and cross-checking of all work done in the office.

General controls — Require all employees to take a vacation that lasts at least one week and extends over two consecutive weekends. Review all payables with original documentation.

Cash — Record all cash receipts and provide patients with a walk-out statement. Make deposits on a daily basis. Endorse checks immediately and balance the checkbook.

Accounts receivable — Balance the rest of the accounts receivable with the patient ledger. The doctor should be the one who authorizes all write-offs and adjustments. Review the audit trail daily along with an independent audit of all accounts.

Spot checks — Make everyone aware that you are more involved in the daily operation of the business part of your practice by spot checks. Follow through!

Credit cards — Review your credit card merchant statement on a monthly basis. Remove all credit refund slips from the practice and discard any signature stamp that may be available.

Accountants — Do not depend on them! Accountants only work with what is given! To them, changes can seem normal! Remember, it’s your business!

Author bio
Donald P. Lewis Jr, DDS, CFE, is an expert in fraud and embezzlement, a diplomat of the American Board of Oral and Maxillofacial Surgery, and is currently in private practice in Cleveland, Ohio. For more information on Dr. Lewis’ seminars or books, please call (216) 261-1010 or e-mail him at [email protected].