Skimming — unrecorded sales

An employee collects payment for a sale or service and never records the transaction, so the money never enters the accounting records. The scheme depends on the same person taking the order and the payment: retail counters, field service calls, fee and permit windows, parking, concessions, and off-site or after-hours sales.

Partly covered. The remaining analysis is planned.

Starter pack: Revenue and receivables review

Red flags

In the data

• Revenue or gross margin for a location, route, or employee declines while activity measures (traffic, units, permits issued, hours scheduled) hold steady
• Revenue per unit of capacity below comparable locations
• No-sale transactions concentrated with one cashier or shift
• Cash share of sales declining at one location while card share holds steady
• Inventory shrinkage that is not explained by adjustments or counts

Behavioral

• Employee declines vacation or rotation of duties
• Employee insists on serving certain customers personally
• Customer complaints that no receipt was given
• Lifestyle inconsistent with known income

Internal controls

• No prenumbered receipts or no accountability for receipt books
• One employee both takes the order and collects the payment
• No comparison of recorded sales to independent activity data
• No surveillance, mystery shopping, or customer receipt incentive