Today’s Veterinary Business provides information and resources designed to help veterinarians and office management improve the financial performance of their practices, allowing them to increase the level of patient care and client service.
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8 Today's Veterinary Business Business Veterinarians are anxiously looking for solutions. When things aren't going in the right direction, revisiting the basics is always a good idea. I recommend you start at the beginning by reviewing your system of internal controls, or the lack thereof. I believe there are two types of veterinary practices: those that have been stolen from and those that know they've been stolen from. While stopping theft completely may be impossible, the problem can be deterred and mitigated. Theft Is Widespread Which practice owner hasn't sus- pected that money mysteriously disappeared? Wondered about vanishing flea/tick preventives and pet food? Noted exceptions in the controlled-drug log? Seen unex- plained adjustments and discounts on end-of-day reports? They're rightly concerned. Eighty-six percent of respondents in an American Animal Hospital Association survey said em- ployees had stolen from their veterinary clinic. Perhaps the other 14 percent had yet to notice. Security experts estimate that as many as 30 percent of all employees steal and that another 60 percent would steal if given sufficient motive and opportunity. No em- ployee is fraud-proof. No practice is immune. Practices are attractive targets. They are small businesses, often with trusting owners and minimal internal controls. Because of their size, practices usually have fewer checks and balances and less segregation of duties — assigning different people dif- ferent tasks — than larger businesses do. Internal controls are systems of checks and balances that help ensure that clients pay for the goods and services they receive. The practice's assets are safeguarded. Internal controls are neces- sary to deter employee fraud, embezzlement and theft. They are the ounce of prevention worth a pound of cure. Certified public accountants are trained to evaluate internal controls. Invite your CPA to review your systems and processes. Shocking but Common The largest embezzlement case I witnessed firsthand was at the Fel- lowship of Christian Athletes. Over a seven-year period, the associate finance director, who had worked there for over 20 years, stole more than $1.1 million. I've seen it all at veterinary clin- ics: spouses stealing from one an - other, partners cheating each other blind, trusted hospital managers with a dark secret, receptionists enjoying lavish lifestyles financed Business is tough. Costs are rising, but revenues are not. Transactions and new-client numbers are flat, and so is the pet population. Unprecedented competition in the pharmacy world threatens a once-solid income stream. Dr. Google is ever more prominent. The typical embezzler seems an unlikely candidate: a long-time employee who appears to be loyal and trustworthy. Vaccinate against fraud, embezzlement By Fritz Wood, CPA, CFP All aspects of managing a cash register should not be one person's responsibility. Your practice likely has fallen victim to a thief or scam artist. Take a few critical steps to prevent a recurrence. Business