Lack of financial oversight can easily result in internal fraud, but monetary abuses between business partners also occur in the absence of accounts payable audits and other accounting protocols.
In October, Minnesota Public Radio announced that it had filed a law suit alleging that over the last 10 years, Thomas Jones, head of the United Audio Corporation, had embezzled nearly $315,000 in funds that belonged to the two firms' partnership. Silver Creek Tall Tower Associate, the joint enterprise in question, was founded for the purpose of building a broadcast tower in the Rochester, Mich., area.
The Star Tribune reported that Minnesota Public Radio based its allegations on gaps in its accounting.
"In short, MPR believes it has never received a distribution of cash from Silver Creek," the public radio station's suit said, according to the news source.
More recently, MPR reported that Jones denied its allegations and counter-sued, accusing the organization of defaming his company. According to MPR, Jones' court filing alleged that the station had "maliciously run roughshod over the reputation of a 77-year-old man" and made him appear to be an "an embezzler and fraudster in local media."
The back-and-forth is likely to go on for some time. Meanwhile, companies can implement audit solutions to ensure that they don't get caught up in a similar scenario.