MML Review Magazine Winter 2026

WHAT’S AT STAKE WHEN YOUR ORGANIZATION

LACKS PROPER SEGREGATION OF DUTIES

Plus, Three Ways to Fix It By Troy Snyder, Matthew Bohdan, Bryan O’Neill, & Bailey Kahl-Wu

Too few staff, a shoestring budget, technology limitations, and a simple lack of internal controls— sound familiar? These challenges show up across industries, especially in organizations with lean teams, limited budgets, or outdated legacy systems. But they’re also major risk factors that stand in the way of proper segregation of duties (SOD). When SOD does break down, you risk inefficiency, and even worse: accountability failure. At its most simple, SOD is a form of risk management. The key is requiring that separate people complete

critical tasks to avoid “incompatible duties” like recording, authorizing, and processing cash disbursements. This allows for more oversight, which leads to fewer mistakes and lower fraud risk. As the American Institute of Certified Public Accountants notes, failing to segregate duties is like handing just one person the keys, the code, and launch button for a nuclear weapon system. The risk might not be nuclear, but the fallout can still be serious. Here’s how failure to segregate duties hurts organizations:

Does your organization have proper segregation of duties in critical business applications and processes? Learn more by completing the fillable form below. After answering the questions, you’ll have a high-level view of functional areas that could pose increased risk for your organization. Use these thought-starters to guide future conversations with your professional advisor about risk management. And don’t forget to regularly recheck your responses over time, and refresh them as needed. This is especially important as your organization grows and adapts. Effective risk management should be an ongoing process, as part of an organizational culture of continuous improvement.

STEP 2

STEP 1

STEP 3

Step 1: CASH DISBURSEMENT ANALYSIS You can save your progress and return to this worksheet at a later date by clicking “Save As” and saving to your device.

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YES NO UNSURE N/A

Can staff who maintain and control checks also sign off on checks (authorize) and prepare checks (record)?