EXHIBIT 101 / THE HANDBOOK
EXHIBIT#12SEVERE
Management & OwnershipComposite score: 78/100

Time and Attendance Fraud

Buddy punching and inflated hours quietly bloat every payroll run — the highest-frequency fraud in the payroll category, occurring at some scale almost everywhere.

Risk Scores

Frequency100
Financial Loss70
Detection Difficulty70
Prevention Ease60
Composite Score78/100

Perpetrator Roles

Chef / KitchenCashier

Affected Formats

QSRFast Casual

Detection Difficulty

Moderately difficult. Requires consistent audit procedures and data analysis to surface.

HOW IT WORKS
Product in good condition
Waste form completed
Product removed from site
Loss recorded as waste
No physical verification
Handbook Chapter · F-012

Waste & Spoilage Fraud

Full chapter with identity card, real examples, warning signs, detection and prevention guidance.

Exhibit AI Detection

AI-Powered Detection Design

Compare clock-in and clock-out times against some other, independent signal of actual presence — a POS login, a kitchen display login.

Prevention Guidance

Audit Controls

Enhanced audit controls required. Standard procedures are insufficient — implement layered verification.

Technology

Automated POS monitoring, real-time exception reporting, and AI-driven anomaly detection significantly reduce exposure.

Culture & Training

Staff awareness programs, anonymous reporting channels, and clear consequence policies deter opportunistic fraud.

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