Business payroll can be challenging, but it's even more challenging when you have to deal with payroll fraud. One of the best ways to prevent this from happening is to use a payroll software package that keeps things as secure as possible. In this article, we'll explore how you can take advantage of your payroll software to make sure everything goes smoothly and that no one tries to cheat your business out of any money.
1) Ensure Security
The best way to prevent fraud is to have a process in place that minimizes its likelihood. Unfortunately, there's no foolproof method for stopping it completely. That said, you should start by having a clear understanding of how potential criminals could steal from you and implementing processes that limit their opportunities. For example, if you have employees who travel frequently or work remotely, consider only paying them via direct deposit so they don't have access to sensitive company information or a company checkbook. Similarly, a number of payroll security tips recommend not storing employee tax information on-site. Having a policy in place that requires employees to come into your office with proof of identification before being paid is an easy way to minimize fraud risk.
2) Reduce Regulatory Burden
The administrative burden of running a small business in today's regulatory environment is significant. Use technology to help reduce payroll management overhead and simplify recordkeeping. Payroll fraud is a very real problem for companies of all sizes, and there are steps that businesses can take to ensure that their employees aren't committing fraud in order to line their own pockets at company expense. Payroll fraud often involves someone within an organization manipulating records in order to decrease or increase their paycheck beyond what they were actually owed, and according to experts, it costs businesses billions of dollars each year. The most effective way for small businesses to combat potential fraud is by using strong internal controls on data entry and external controls via outsourcing payroll functions.
3) Keep IRS Audits at Bay
Automation is important for two reasons. First, automated data is easier to trust than entered data. If you enter employee details into an online payroll system yourself, there's always a chance that you'll make a mistake or miss something. Second, automation takes away any opportunity for humans to be targets of fraud. One of the most common ways businesses are defrauded by their employees is when someone manually processes their own time card and enters timesheets with hours they never worked. Software platforms like UZIO take every step of manual processing out of employees' hands-including their ability to enter any information at all-and use tools like double-entry accounting and form validation that prevent false or inaccurate entries in one place from ever happening in another.
4) Protect Payroll Tax Data
The ability to automate repetitive tasks is key for small businesses looking to keep operations running smoothly. Automation isn't just helpful, it's mandatory when you have more than one employee. From sending out payment reminders to updating employees with their schedules, basic human error can make even simple tasks more difficult. Payroll software automates all these tasks and ensures nothing gets lost in translation. This way, no matter how many employees you have or what kinds of unique needs they have, automation helps you cover all bases without any slips-which means fewer errors and greater accuracy when it comes to payroll processes.
5) Automation prevents any discrepancy in data
One of the reasons businesses often fall victim to employee theft is because they don't take steps to ensure data integrity. With manual processing, there's an opportunity for error that will almost certainly lead to inaccurate results. After all, humans are prone to mistakes. That means you have a better chance of running into trouble if you trust people with a lot of power-especially when they're dealing with a sensitive process like payroll. Even a small mistake in entering numbers can have an impact on how much money is being paid out and potentially put your company at risk.