Despite the constant barrage of news about corporate theft and fraud, there are still far too many situations in which hospitality companies unknowingly pay criminally-minded individuals or phony companies posing as legitimate vendors.

How is it possible that "legitimate" companies have a private mailbox at the local UPS Store, a private residence, or even a prison address? Or that invoices a month apart with consecutive numbers both get paid? Or "invoices from a "vendor" whose address happens to match that of a company employee get paid?

To avoid such frauds your company must have in place tight controls for the...

Vendor Master Set-Up

The Vendor Master set-up process requires appropriate-and continuously enforced-segregation of duties.

Details: The individual or department authorizing a vendor should be in a department other than that of the team processing invoices and generating disbursements.

When establishing segregation of duties for the Vendor Master set-up, Christine Doxey, Vice President of Account Management at Apex analytix, a leading recovery audit consulting firm urges companies to include employees who are responsible for the business process and those who are provided with systems access.

Caution: Even where it may appear that segregation of duties exists, ensure that system access is controlled to allow use only by individuals ...