Fraud in Revenue and Cash Receipts Cycles: Designing a Sound System

Revenue and cash receipts are two critical areas that require strong controls to prevent intentional fraud or unintentional misstatements. While there is well-publicized fraud in these areas in larger companies, it also occurs in smaller businesses and nonprofit entities. A sound system of internal controls is needed to help prevent fraud occurrence. All too often, a "one size-fits-all" system is put in place without considering the uniqueness of each entity. It is crucial that an internal control system is tailored so that the areas of greatest risk receive the most attention.