How to prevent theft, embezzlement - DVM
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How to prevent theft, embezzlement
Create controls within the practice to minimize your risk


Ask appropriate questions

Appearances are important. If employees perceive internal controls are in place, that could be a deterrent to theft. For example, when you require daily cash reconciliations that compare the cash reported on the deposit slip to the cash reported on the end-of-day summaries receipt book, prior experienced overages and shortages seem to disappear.

Such frequent reconciliations are required for very liquid, desirable assets that have a high predisposition for theft. The daily reconciliation does not negate the possibility of theft, but it is quickly noted, along with the appropriate inquisitions. You quickly avert a more substantial loss and potential major risk.

Restrict access

Limit accessibility to practice assets only to those who have a business purpose in using them. Blank checks, for instance, should be stored off-site or in a safe. Distribute small numbers as needed to the person preparing checks. Blank checks should be inaccessible to anyone else.

Large caches of inventory purchased in bulk at the beginning of a season (heartworm or flea-and-tick products) can be stashed in a central supply, accessible only to a small number of people who disburse the caches to other areas of the hospital.

An independent viewpoint

Analysis of internal controls in your practice and assessment of the inherent risk can occur through your CPA. Such an analysis demands an investment. Many practitioners are unwilling to pay more than a nominal amount for the service until a loss has occurred.

In general, CPAs offer internal-control studies to clients in a separate management consultation. Because every practitioner has a different tolerance for risk, a study of internal controls for each should be tailored to the situation. The practice administrator, manager and accountant or consultant should map out a plan of investigation of existing internal controls to determine where the greatest risk exists.

Dr. Heinke is owner of Marsha L. Heinke, CPA Inc. and can be reached at (440) 926-3800 or via e-mail at


Source: DVM360 MAGAZINE,
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