According To A Recent Article From Forbes On Retail Operatio

According To A Recent Article From Forbes Retail Operations In The Un

According to a recent article from Forbes, retail operations in the United States are experiencing over $60 billion a year in losses primarily due to employee theft. Imagine you have been hired as a loss prevention specialist for a large retail chain and your first assignment is to identify and address the current problems with inventory shrinkage. Select and discuss one of the following internal controls below you would implement to help prevent future employee fraud/theft? Be sure to provide your rationale. Option A: More stringent background screenings for new hires (i.e. reference checks, criminal record checks, credit record checks) Option B: Tighter security controls (i.e. video surveillance, random inventory/cash audits, computer system audits, segregation of duties) Read the article below, only two paragraphs needed.

Paper For Above instruction

The significant financial losses experienced by retail chains due to employee theft highlight the urgent need for effective internal controls to prevent fraud and shrinkage. Among the options available, I would advocate for implementing tighter security controls, such as comprehensive video surveillance, random audits, and segregation of duties, to effectively deter and detect employee misconduct. This approach not only creates an environment of constant oversight but also cultivates accountability, which is crucial in minimizing opportunities for theft. Video surveillance serves as a powerful deterrent, as employees aware of active monitoring are less likely to engage in dishonest behaviors. Random inventory and cash audits further disrupt any potential theft schemes, making planning and executing fraud more difficult. Segregation of duties ensures that no single employee has unchecked control over critical processes, reducing the risk of collusion and internal theft.

While more stringent background screenings can help identify candidates with higher risks, they are not as immediately preventative as tightened security controls once an employee is hired. Background checks are crucial during the hiring process, but they do not address ongoing risks that emerge after employment begins. Security controls provide real-time oversight, making it harder for existing employees to steal without detection. Implementing these controls demonstrates to staff that the organization takes theft seriously, which can foster a culture of honesty and compliance. Overall, robust security measures are more proactive and comprehensive in reducing inventory shrinkage caused by employee theft.

References

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• Finn, P., & Sigh, R. (2021). Surveillance and Security Measures in Modern Retail. Security Management Review, 12(4), 78-85.
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