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Why Only a Limited Number of People Should Have Access to Company Cash

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One of the reasons that I have never gone into business with anyone else or hired any employees is because I am terrified of having to cede any control of my financial affairs. If I partnered with somebody, what if they embezzled our joint venture and left me broke? If I hired someone, how would I ever go on holiday? Would I let them sign cheques in my absence? What if they ran off with my funds?

Perhaps I am overly cautious, or too cynical about my fellow humans. On the other hand, the fact that production has halted for The Agency leads me to believe that perhaps to many people had their fingers in the till. From what I can tell from the Standard article. despite funds having been made available, the cast are unhappy with their level of remuneration while the crew claim that a portion of their pay is being withheld. Both parties are unhappy with the producers, who are trying to carry out a desperate bait-and-switch by blaming the lack of money on MNet, who deny being responsible.

Serendipitously, I know quite a few people who work in “showbiz:” riggers, electricians, producers, generally all the people we either don’t see or ignore when being entertained. And what they tell me is that any production worth its salt –  whether a children’s nativity play at a kindergarten or a full touring circus – will have a production accountant. This is not just to make sure that the venues are paid for and that the caterers can buy food; it’s also to make sure that the roadies and the band entourage don’t blow the production budget on hookers and blow.

Any group of people that is not a military unit will have a collection of objectives and priorities, which may or may not converge. If each of these people had equal access to a communal pot of money, it is inevitable that somebody would spend money on something they shouldn’t. This is why there is a production accountant; not only can they keep track of what has been spent, they can also deny inappropriate requests for funds. You want money to get more cable so that the lighting director can set up a particular shot? Fine. You want money so that you can rent a suite to impress the second line backing dancer? I hope your bank account has an overdraft facility.

So did The Agency have a production accountant? If not, why not? If it did, do they know where the missing money is? The media is usually portrayed as one of the least serious industries, one where the emphasis is on “art” and creativity. But media and advertising, its symbiotic cousin, are now big business, with millions at stake for major players. It’s surprising that MNet appears to have permitted Starling Quality Entertainment, the production company, to run such a high-profile program in such a slipshod manner, and that the accounting practices on set were so deficient that several million shillings disapeared into thin air.

Every business should make sure that only a select few can access company funds above a certain amount. If you would not be happy to be mugged for it, don’t let your employees snaffle it from under your nose. It’s fine if you’re rich enough to ignore several millions missing, but if the money has been earmarked for anything other than your personal use, keep an eye on it, keep it locked down, and keep access to it strictly limited.

[Image by PJ in Oz]

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1 Comment

  1. mainat says:

    Any firm or venture will always be exposed to fraud if it doesn’t observe the 4 eyes principle in its transactions i.e. you do one half of the transaction, another person checks what you’ve done and completes the transaction.

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