WHAT WOULD YOU DO IF YOUR COMPUTER CRASHED tomorrow and you found out your backup was corrupted and couldn't be restored? Pull your hair out, right? What would your spouse do if you died? Would he or she know how to value your practice and sell it, or would it sit there until it became worthless? Do you know what to do if your practice burns to the ground?
This is the article that you don't want to read, but you must. We think these things will never happen to us. The fact is, they can and do, and we should be as prepared as possible. Taking lessons from that great teacher, experience, I've spoken to many veterinarians who have endured some severe hardships. My heart goes out to them and I hope their lessons help you.
How to outsmart employee thieves
Do you think your employees would never steal from you? I know of one practice that was embezzled out of $68,000 in one year. Another practice found out that one of its employees was selling flea control and heartworm medication on eBay—want to guess where she was getting the product?
There are many ways to embezzle from a practice, but usually the problem lies in not incorporating or maintaining controls that would prevent it from occurring. For example, when was the last time you updated your password protection on your computer? Do you have different levels of password protection? Have you given your password out to someone? Sometimes the password that accesses the practice's most sensitive information is common knowledge.
Here are some other common-sense procedures that need to be implemented and maintained:
- Justify the cash drawer at the end of the day.
- Print out and review itemized audit trails and transaction journals.
- Reconcile the end-of-day computer report with the bank deposit.
- Review credit card transaction journals and tie them into the computer end-of-day reports.
Most software companies will provide you with their recommended procedures if you ask them. On the disbursement side, have bank statements sent to the owner's home for review. Verify whom checks were written to and who signed them. Compare deposits to end-of-day computer reports. How effective is your inventory control? Do you conduct yearly inventories and update your computer system? I'd guess that most of you would say "no"—if someone walked out of your practice with a box of flea control medication or heartworm preventive, you wouldn't know it. There aren't that many products that employees would be interested in helping themselves to. So even if your inventory control isn't what it should be, you should still keep track of food, flea control, heartworm medication, and controlled drugs. You don't want your products sold anywhere but in your practice.