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We had heard rumours of what people referred to as a ‘phantom accounting system’, also called zappers and phantom ware. This phenomenon was unheard of in South Africa at the time. The more formal term used to describe this kind of criminal financial-management software is a ‘sales-suppression system’. The Organisation for Economic Cooperation and Development (OECD), in which South Africa has observer status, issued a guide on these systems in 2013.10 On the surface, the technology seems like a supposedly normal accounting system, used mainly by retailers. It has all the expected features: it records stock, sales, invoices, receipts and taxes. It can print daily, weekly and monthly accounting records. Yet the software has a feature that can blank out certain sales and receipts. You can set it to suppress, for instance, every fourth sale, or random sales of a particular value, whichever you prefer. The effect is that, on paper, your stock, sales and receipts would balance for tax purposes. All you would have to do is click on a secret place on the screen, or type a particular code on the keyboard, and the unrecorded sales and receipts would reflect. One would then be able to take this money out of the company’s takings for the day, week or month, and people would be none the wiser.

Just in case we hit a black spot or something. Jeez, it’s cold.’ Craig rubbed his hands together and blew on them. ‘Wait until we get out to Billbinya. You’ll know what cold is then. So, you right? Can I back into the trailer now?’ ‘Yep.’ Craig directed Dave as he backed up to the trailer that held a quad bike in case they needed to muster any stock. After attaching it to the tow ball and hooking up the lights, he jumped in the passenger side. He adjusted the squelch on the CB radio and asked, ‘Have you been listening to the CB as you’ve been driving?’ ‘Yeah, I haven’t heard anything that indicates unusual stock movements. I’ve heard the truckies telling others that we’re around, though, so it’s common knowledge that we’ve arrived.’ As they drove towards Billbinya, Dave discussed the program he had in mind. ‘I want to try and do a stocktake of all the animals that are on Billbinya. So we’ll get Gemma’s stock numbers and a map, work out what stock is in which paddock. We’ll check out those animals. You can check the earmarks and I’ll see if I can get a count of the mobs we come across. If we don’t get it all done by tomorrow we’ll stay another night. If we find anything untoward we’ll ask to see the paperwork. Weigh bills, stock sale invoices. Gemma told me that Ned has done a full stock count for the 30 June figures, so they should be pretty up to date.’ ‘I reckon talking to Ned and Ben would be a good idea too,’ Craig suggested. ‘Theoretically, they should have copies of all the contracts to do with stock from the past few years, that way we can cross-reference it with Gemma’s paperwork.’ ‘Yeah, that’s true,’ Dave said. ‘That might be worth following up when we get back. You didn’t find anything criminally interesting on any of the players, did

friends had started hanging around. Franny could feel her stomach hardening and twisting into knots when they arrived, pushing and shoving one another and tripping over their huge basketball shoes. It was a wonder they didn’t knock over a display rack or topple one of the neatly stacked pyramids of paint cans. They seemed to be everywhere at once, and she couldn’t possibly keep an eye on all of them. Actually, she was a little afraid of them. While they dressed like kids, she knew they were actually young men. They were bigger than she was and full of rough male energy. From what she observed it seemed Ben was their leader and they were reporting to him. She was sure they were up to no good. Their whispered conversation was full of winks and nudges, and they constantly checked over their shoulders to see if they were being overheard. She tried to keep her distance, but if she had to approach them to help a customer, she noticed they would move away or fall silent. Whenever Mr. Slack appeared, they disappeared. Returning to the invoices, Franny went through them one more time. She couldn’t understand it. According to the paperwork, the store had received enough batteries to last through the summer, based on her best estimate using last year’s figures. They’d gotten twenty boxes each of AA and D batteries, the most popular sellers, and ten boxes each of the other sizes. Last week she’d noticed the display rack was nearly empty, and she’d asked Ben to fill it. “Can’t,” he’d said, avoiding her eyes. “They’re all gone.” “There should be plenty in the storeroom,” she’d insisted, looking curiously at his two buddies, who were lounging by the paint display. They seemed to find the conversation extremely amusing. “Go check again.” “There’s no point. I’m telling you, they’re all gone. Look, I’m taking a break now,” he’d said, signaling his friends to follow him outside. Sure enough, she couldn’t find any batteries in the storeroom, either. She was sure they hadn’t been sold; she would have noticed the unusual number of sales and ordered more. Where had they gone? It was very disturbing, especially since she’d been having such a hard time lately making up the bank deposit. That was always the first task of the day. She would take the previous day’s take out of the safe and add up the checks and cash, square them with the total sales figure, and fill out the deposit slip. Then Mr. Slack would put the whole business in a blue vinyl zippered pouch and take it to the red-brick bank across the street. For the past few weeks, however, she hadn’t been able to get the figures to match, even though

Owing to the ever-increasing pressure on space, as retailers continue to extend private label ranges, there is a risk of branded products being moved to less-optimal locations, having fewer promotional slots and facings or being delisted. Manufacturers cannot wait for this to happen before reacting; they must be proactive in making the case for their brands. While the absolute cash and margins on private labels may be higher for the retailer, the manufacturer has to shift the focus to total system profitability. Many factors favour manufacturer brands when total profitability is considered, including: Sales velocity: Shelfspace turnover is often higher for manufacturer brands. The velocity of leading manufacturer brands is often 10% higher. Profit per linear inch of shelfspace. Discounts and off-invoice allowances: Includes slotting allowances, listing fees, promotional deals, advertising and merchandising allowances, and credit for return of unsold merchandise. Promotional and advertising fees. Provision of ‘free’ logistics services: Includes transportation, warehouse and store labour, and merchandising help for the retailer. Manufacturer brands usually retail at higher-than-average prices: Even when the net margin on manufacturer brands is lower, the absolute cash profit per unit may be higher.

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■ Poor labor efficiency due to lack of job costing ■ Sales team focus on revenue rather than margin (discounting quotes, making concessions, and so on) ■ A lack of emphasis on service sales (rather than product sales), which were generally more profitable ■ Excessive punch list items requiring follow-up work without the ability to invoice ■ Errors in order entry: finish, fabric, pricing, and so on ■ Installation damage and concealed damage on receipt of product ■ Excessive nonbillable overtime ■ High average collection days ■ Small-tool loss and damage

Building a business is a creative act. Few of us realize when we start out that we are creating not only a company but a culture. That’s because it’s usually not planned. It just happens. While everyone is focused on something else, making sales, providing service, sending out invoices, a little community springs up. It has its own unspoken customs, traditions, modes of dress and speech, and rules of behavior. By the time you become aware of it, the culture is often well established and it will probably be a reflection of your personality.

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The triangle of fraud . . .” “What’s that?” He started, as if I’d woken him. “Oh—incentive, opportunity, and rationalization.” He stuck out three fingers and began counting them off. “The first leg, incentive, is pressure to commit the crime. A person is looking for a way to solve their financial issues due to an inability to pay their bills, drug and/or alcohol addiction, or simply status, wanting to have a bigger house or drive a fancier car.” He counted off another finger. “The second leg is perceived opportunity, where the individual identifies ways to commit fraud with the lowest amount of risk, like lying about the number of hours worked, inflated sales or productivity to garner higher pay, creating false invoices for products never purchased and pocketing the money, or selling proprietary company information to competitors.” He counted off the last finger. “The third leg of the triangle, and this is an important one, is where individuals persuade themselves into believing that they’re doing the right thing. They convince themselves that they’re just borrowing the money or feel entitled to it through perceived low pay, uncompensated hours, lack of respect, or trying to provide for their family.” “Okay, but what pushes two men whom we assume are relatively upright individuals into going so far as to kill someone?” “A lot of money.” I laughed.

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