Keep Employees From Ripping You Off
Stay Involved In The Finances Of The Business!
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Listen to the audio
- To listen to this interview snippet, just click the play button above (twice if necessary).
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In this audio snippet, you'll hear about:
- Another good reason for the business owner to stay intimitely involved in the finances of the business
- When the cat is away, the mice will play
- When people that are normally honest and trustworthy have full control of the finances without the business owners overview, they can do bad things
Audio Transcript
Yosef:
Number two, and I have seen this multiple times, when the small
business owner detaches himself from the financial operations, I call
it "mice fraud." There it too much mice fraud that occurs in the
business.
Travis:
all right.
Yosef:
Mice fraud basically comes from the saying "When the cat is away, the mice will play."
Travis:
Right.
Yosef:
You have people that are pretty honest and genuine, but when they are
suddenly the only ones in charge of the money, and the owner of the
business doesn't really are what is going on, they lose their scruples.
It is a very dangerous situation.
Travis:
I have heard of that in more than one occasion.
Yosef:
If I can indulge you with a story.
Travis:
Please.
Yosef:
When I was an undergrad at UCLA, I had a very strong relationship with
a number of accounting professors. I did a lot of T.A. work, etc. One
of my accounting professors sent me off to see a woman who was a
psychiatrist who actually revolutionized the area of ADHD in Southern
California. She was extraordinary successful in some period in the 80's
and 90's, made a lot of money.
But
again, her area of expertise was dealing with children with ADHD, not
dealing with the business side. She had ten other practitioners working
for her. They made so much money, but they didn't have time to manage
it, so the office manager one day just picked up and left with all the
money.
Travis:
Oh my.
Yosef:
And that promptly convinced this psychiatrist to go back to school and get her MBA.
Travis:
In finance.
Yosef:
What?
Travis:
In finance?
Yosef:
She got her MBA in finance, that's correct.
Travis:
[laughs]
Yosef:
She put her heart and soul in this new approach to dealing with
children, but again, there was no way that she could continue without
having at least a basic business background.
There
are times when I'll be sitting with colleagues of mine from business
school, and they'll joke around saying, "'Hey, Yosef, you're a CPA,
you're an attorney. I still make more than you, because I know how to
use a CPA and how to use an attorney." That's true.
Travis:
[laughs] It cuts right to the heart of it.
Yosef:
Yeah, it's really important to know how to use a CPA and how to use an
attorney, but to know how to use them you have to have a basic
understanding of what they do and what they don't do.
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