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Jacobs & Newmark, CPAs
100 Lexington Drive, Suite 250, Buffalo Grove, IL 60089
Phone: 847-537-0100
December 2023
December 2023 Client Profile
Scott owns a popular coffee shop. Earlier in the year, he noticed a discrepancy in stock. It turned out to be petty theft by an employee. The employee was terminated, and Scott reported the loss to his insurer, who recommended he take these steps to help prevent future losses:
- Require criminal background checks of all new employees.
- Separate duties so no one employee is responsible for making transactions and handling money.
- Develop fraud prevention policies and communicate them and the disciplinary measures for violations.
- Perform routine financial audits.
- Check stock and equipment regularly.
- Provide an anonymous means for employees to report suspicious activity.
Scott's accountant also pointed out that for income tax purposes, Scott should be able to deduct any part of the loss not covered by the insurer — the deductible, for instance — if all other tax requirements are met.
Client Profile is based on a hypothetical situation. The solutions discussed may or may not be appropriate for you.
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