Workplace Fraud Costs Canadian Businesses Billions Annually

Workplace fraud costs Canadian businesses billions annually

 

Most SMEs ill-equipped to respond to problem; slowing economy raises risk

 

TORONTO, December 6, 2011 – Workplace fraud in Canada costs small and medium enterprises (SMEs) billions of dollars each year, according to the latest research report from the Certified General Accountants Association of Canada (CGA-Canada). Collective losses are conservatively estimated at $3.2 billion for 2010. Yet many firms are overlooking the problem or underestimating their vulnerability.

“The risk of workplace fraud is almost certain to rise as economic growth slows and more employees experience financial difficulties,” says Rock Lefebvre, CGA-Canada’s Vice-President of Research and Standards and co-author of the report. “It’s a genuine threat and companies need to be vigilant. It may be a case of pay now, for prevention, detection and response measures, or quite possibly pay later.”

The survey-based report revealed that about 290,000 Canadian SMEs were victims of one or more instances of workplace fraud in the past year. The most common forms of fraud were misappropriation of inventory or assets, and misappropriation of cash.

Despite this, 74 per cent of respondents believe their exposure to occupational fraud is low, with 80 per cent having no response plan in place and 59 per cent undertaking no form of periodic risk assessment.

Mr. Lefebvre warns that the harm done by occupational fraud goes beyond monetary damage.

“The financial loss is one thing, but it’s staff morale and management confidence that really take a hit,” says Mr. Lefebvre. “The reputation, value, and public and client trust of these companies also suffer.”

Highlights and the full report, Does Canada Have a Problem with Occupational Fraud? are available on the CGA-Canada website.

This is the latest report by the association.  CGA-Canada develops impartial and objective research on a range of topics related to major accounting, economic and social issues affecting Canadians and businesses. The association is recognized for heightening public awareness, contributing to public policy dialogue, and advancing public interest.

 

About CGA-Canada                                                                                                                                                   

Founded in 1908, the Certified General Accountants Association of Canada serves 75,000 Certified General Accountants and students in Canada and more than 90 countries. Respected accounting and financial management professionals, CGAs work in industry, finance, government and public practice. CGA-Canada establishes the designation’s certification requirements and professional standards, offers professional development, conducts research and advocacy, and represents CGAs nationally and internationally.

For further information or to request an interview, please contact:

James Bigg

Edelman Public Relations

Tel: 416-849-2496

Email: james.bigg@edelman.com

 

Taylore Ashlie
Director, Communications
CGA-Canada
Cellular: 604-307-0212
Email:
tashlie@cga-canada.org