Inventory larceny and false write-offs

Inventory or supplies are stolen outright, and the shortage is concealed by recording adjustments, write-offs, scrap, or damage, or by altering count results.

Planned. Analysis for this scheme is in development.

Starter pack: Not part of a starter pack

Red flags

In the data

• Adjustments and write-offs concentrated by user, location, or reason code
• Adjustments posted shortly before or after physical counts
• Shrinkage trend rising for one location or item class
• Write-offs of high-value or easily resold items

Behavioral

• Employee insists on counting their own area
• Employee present at unusual hours

Internal controls

• Users who handle inventory can post adjustments
• Counts not performed or observed by independent staff
• No approval required for write-offs