Small Retail Business Strategies to Detect and Prevent Employee Fraud

Small Retail Business Strategies to Detect and Prevent Employee Fraud by Comfort G. Akuh MSA, Western Michigan University, 2011 BS, University of Buea, 2001 Doctoral Study Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Business Administration Walden University October 2017 Abstract Small businesses have an important role to play in the U.S. economy. However, employee fraud can jeopardize the sustainability of small businesses. Grounded on Cressey’s fraud triangle theory, the purpose of this multiple case study was to explore strategies used by selected managers and owners of small retail businesses to detect and prevent employee fraud. Ten participants from 5 small retail businesses participated in the study. Nine participated in a face-to-face semistructured interview, and 1 participated in a telephone interview. These participants included 5 owners and 5 managers of small retail businesses in the state of Michigan in the United States who have implemented strategies to detect and prevent employee fraud. Through a process of methodological triangulation, casual observations and documentary evidence supplemented data collected through semistructured interviews. Using thematic analysis by coding narrative segments, the research findings included themes of controls and communication, cash register accountability, segregation of duties, monitoring, and action against perpetrators. Managers and owners of small businesses may benefit from the findings of this study by gaining awareness of the need to detect and prevent employee fraud. The implications for positive social change may include the potential to increase appropriate controls over employee fraud, thus enabling owners of small retail business an opportunity to operate effectively and efficiently, which could increase employment opportunities. Increased employment opportunities could create a positive effect on other small retail businesses and allow local communities to prosper.Small businesses have an important role to play in the U.S. economy. However, employee fraud can jeopardize the sustainability of small businesses. Grounded on Cressey’s fraud triangle theory, the purpose of this multiple case study was to explore strategies used by selected managers and owners of small retail businesses to detect and prevent employee fraud. Ten participants from 5 small retail businesses participated in the study. Nine participated in a face-to-face semistructured interview, and 1 participated in a telephone interview. These participants included 5 owners and 5 managers of small retail businesses in the state of Michigan in the United States who have implemented strategies to detect and prevent employee fraud. Through a process of methodological triangulation, casual observations and documentary evidence supplemented data collected through semistructured interviews. Using thematic analysis by coding narrative segments, the research findings included themes of controls and communication, cash register accountability, segregation of duties, monitoring, and action against perpetrators. Managers and owners of small businesses may benefit from the findings of this study by gaining awareness of the need to detect and prevent employee fraud. The implications for positive social change may include the potential to increase appropriate controls over employee fraud, thus enabling owners of small retail business an opportunity to operate effectively and efficiently, which could increase employment opportunities. Increased employment opportunities could create a positive effect on other small retail businesses and allow local communities to prosper. Small Retail Business Strategies to Detect and Prevent Employee Fraud by Comfort G. Akuh MSA, Western Michigan University, 2011 BS, University of Buea, 2001 Doctoral Study Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Business Administration Walden University October 2017 Dedication I dedicate this study to God Almighty, who blessed me with a smooth journey through the program. I also dedicate this study to my loving and supportive parents, Barnabas Anguh Akuh and Francisca Vuwen. To my amazing sisters, Constance Akuh and Meghan Akuh. To my adorable nieces, Tahila-Kay and Zoe. To my extended family and friends for their encouragement. I love you all! Acknowledgments I would like to thank my Chair, Dr. Roger Mayer, for his generous support, availability, and encouragement. Dr. Mayer, you kept me going. May the LORD continue to strengthen you, keep you in perfect health, and may He make his face shine on you and be gracious to you. Thank you, Dr. Kim Critchlow (second committee member), Dr. Denise Gandy Hackett (URR), and Dr. Freda Turner (retired Program Director) for your motivation and timely feedback on my study. It was a blessing to have such a strong and inspiring committee. I would like to thank Dr. Edgar Jordan, Dr. Rocky Dwyer, and other Walden University instructors, classmates, and staff who contributed to the successful completion of this study. Thank you to all the business owners and managers (participants) who took time off their busy schedule to participate in this study. God bless you!