16 February 2009
Businesses across the world must step up vigilance on fraud risk in times of economic stress, according to CIMA's 'Fraud Risk Management: a guide to good practice' information released today (16 February).
This is particularly important for small businesses. As recent high profile cases have centred on multinationals, SMEs may not realise that they are often more susceptible to fraudulent practices, and that they can be hit by proportionately higher losses which could prove crippling in the current economic climate.
Surveys are regularly carried out to try to estimate the true scale and cost of fraud to business and society. These surveys all indicate that fraud is prevalent within organisations and remains a serious and costly problem. Indeed, when CIMA surveyed 200 of its member FDs in the UK earlier on this year, it found that 55% felt that employee fraud posed a significant risk to their organisation.
'Fraud Risk Management : a guide to good practice' ' see www.cimaglobal.com/fraud - will arm management accountants with guidance and case studies on how to prevent, detect and combat internal fraud.
Helenne Doody, innovation and development sSpecialist at CIMA, comments:
'Despite the serious risk that fraud presents to business, many organisations still do not have formal systems and procedures in place to prevent, detect and respond to fraud. While no system is completely foolproof, there are steps that can be taken to deter fraud. It is in assisting organisations in taking such steps that CIMA's guide should prove valuable.'
CIMA's approach is being endorsed by the Chartered Management Institute (CMI) following the publication of data which reveals low levels of trust within UK organisations coupled with fears over financial management capabilities.
For example, data published by the CMI shows that 35% of individuals believe 'managing costs' is the biggest challenge they face.
'Fraud can be stopped if robust detection procedures are in place,' says Petra Wilton, director of policy and research at the Chartered Management Institute.
'However, prevention is about more than procedure ' it centres on attitude, meaning that employers should foster a culture where fraud is nothing short of unacceptable. Even in good times, organisations that fall victim to fraud can suffer through damaged reputations, but in bad times the impact can be more personal. After all, if the balance sheet doesn't add up, redundancies may follow as businesses look to address cash flow problems.'
- Ends -
For press enquiries please contact:
Katie Scott-Kurti
Senior Press Officer, CIMA
+44 (0) 20 8849 2347
Katie.Scott-Kurti@cimaglobal.com
Notes to editors
1. The Chartered Institute of Management Accountants, founded in 1919, is the world's leading and largest professional body of Management Accountants, with 171,000 members and students operating in 165 countries, working at the heart of business.
CIMA members and students work in industry, commerce and not-for-profit organisations.
CIMA works closely with employers and sponsors leading edge research, constantly updating its qualification, professional experience requirements and continuing professional development to ensure it remains the employers' choice when recruiting financially-trained business leaders.
CIMA is committed to upholding the highest ethical and professional standards of members and students, and to maintaining public confidence in management accountancy.
CIMA is proud to be the first professional accounting body to offer a truly global product in the fast-moving area of Islamic Finance.
According to independent research conducted by the University of Bath School of Management, CIMA's syllabus and examination structure are the most relevant to the needs of business of all the accountancy bodies assessed.
See the CIMA Difference report for further information at www.cimaglobal.com/thecimadifference.
CIMA has been awarded Superbrand status in the UK for a third year in a row this year and for the first time in Sri Lanka.
16 February 2009090216