On 9 March 2026, the hand with ten years on an example wheat and lentil farm in the Palouse, in Washington, gives notice. Only then does the owner learn that nobody else can open the farm’s bank app. The Association of Certified Fraud Examiners (ACFE) counted 1,921 fraud cases across every industry. The median loss, the middle case, was US$250,000 when the person had worked there more than ten years and US$50,000 under one year. So write a one-page register of every key, login and account this week, and set it beside the bank statement on a fixed day each month. The farm, the hand and the date are invented; the survey figures are real.
Why can’t a small farm split who approves, pays and checks?
Because the people to split it among are not there. The US Government Accountability Office (GAO), the federal government’s audit office, writes internal-control standards for federal agencies, not for farms. Its standards say that management should consider separating three kinds of work: authority, in plain terms approving a payment; custody, holding the checkbook or the cash; and accounting, recording what was paid. Giving each to a different person is called segregation of duties.
On a farm where the owner or a couple handles the money, one or two people do all three. In the US, 84.7% of farms are family or individual operations for tax purposes. That is a legal status, not a count of who handles the money.
Even a full split does not make a farm safe: the GAO notes it cannot absolutely prevent the controls being overridden, because of collusion, where two or more people act together. Where separating is not practical for want of staff, it says management designs other control activities to cover the risk. The standards are for agencies, so what follows is a recommendation. On a farm with one or two people on the money, the alternative is the owner’s monthly check of what the most trusted person moved.
Accept that the split is not coming, and choose the check that stands in for it.
Who costs the most when something goes wrong?
The people with the most years and the most rank, who are also the ones you trust most. The figures here come from ACFE’s 2024 report, which covers 1,921 fraud cases in every industry, not farms in particular, so they set an order of magnitude and nothing more. The median loss rose with the time the person had worked at the victim organization.
Fraud by owners or executives was 19% of the cases, yet the median loss was US$500,000, more than eight times the US$60,000 of staff-level employees. In the report’s group for agriculture, forestry, fishing and hunting, 40 cases had a median loss of US$165,000, a small base.
New Zealand gives a closer picture. Othman and Ameer studied 18 employee-fraud cases that reached the courts there, from 2006 to 2020. The people behind them averaged 48 years of age, the average loss was NZ$189,228 and the average case ran 25 months. The two who held managerial and hands-on duties at once averaged NZ$291,434 over 39 months. In one case an account administrator with full access changed suppliers’ bank details and took NZ$147,390.87. The authors write that changes to supplier records should be restricted to the owner.
The survey does not measure trust. It measures time at the organization and rank, and both go with the loss. It does not say that long-serving people steal more, only that the loss is larger when they do.
An experienced farmer may say that checking a hand who has worked beside you for twenty years is an insult. A check run every month on every key and account names nobody: it is the same for everyone who holds one. Othman and Ameer’s conclusion is that two people looking at the same thing, the four-eyes principle, is still the key, and that trust is not a method of control.
Give the closest look to whoever has the most years and the most access.
What do you check each month, and does it pay off?
Three checks, from the monthly one to the yearly one. Each month, open the bank statement yourself, not a copy the payer prints, and set it beside the entries made by whoever pays. Every payment needs an entry and a paper behind it, such as an invoice. Before any payment above a set amount goes out, approve the list. Once a year, run one check nobody is warned about: a stock count or a sampled payment traced back to its paper. The GAO lists counting assets and comparing them with the records among its controls over physical assets.
Does it pay off? The control in ACFE’s tables closest to your monthly check is management review. Where it was in place, the median loss was US$100,000 against US$250,000 where it was not, and the fraud ran 12 months against 23 before it was found.
A surprise audit shows the same pattern: US$75,000 against US$200,000, and 9 months against 18. These are associations, not proof. Organizations that review may differ in other ways, and the tables do not say how each one ran the review. Small organizations use these controls less. Among those that suffered fraud, management review was in place at 39% of the ones with under 100 employees against 79% of the larger ones, and surprise audits at 17% against 49%.
Recovering the money is rare. Of the victim organizations, 57% recovered nothing, and 43% of the cases came to light through a tip, against 14% through internal audit and 13% through management review.
Pick the day of the month now and write it on the calendar. In the same statement you also see who still owes the farm, in who still owes you and since when.
Who holds each key, login and account?
Write them on one page. The access register has one line per key, login or account, with who holds it and at what level. Use three levels: uses, who can do the task; approves, who can release a payment or a purchase; and administers, who can add people, change payment details or reset a password.
In the example, after the notice the owner sees that the hand approves payments in the bank app and administers the supplier list. The same hand can add a supplier and approve the payment to it, which is close to the New Zealand case above. The fix is to move one of the two lines to the owner.
Keep the register current. For information systems, the GAO asks management to promptly update access rights when employees change job functions or leave. On the farm, that means changing the password, code or lock the day a person leaves or changes duties, and crossing out the line. Whoever covers a critical task when someone is out needs the same access, so the register grows alongside the plan of who else can do the job.
Write one line for every key you can think of, today.
Does a second signature hold in front of the bank?
Not on its own. A rule written between partners may not bind the bank, as an Iowa case shows. Some decisions are worth two signatures: selling or mortgaging land, borrowing above a set amount, opening a bank account or adding a supplier. The case is Bank of the West v. Early Farm Partnership, as summarized by Iowa State University’s Center for Agricultural Law and Taxation.
A father and son held a co-equal farming partnership, and its written agreement required both partners to agree to any decision with a substantial effect. After the father died in 2004, the mother took his share by an oral agreement with the son. The son then signed alone, as general partner, a mortgage on the partnership’s assets to secure a loan to a corporation he owned with his wife.
When the loan went unpaid, the bank sought a judgment of over US$300,000 against the partnership’s real estate. The Iowa Court of Appeals, on 30 March 2011, upheld the mortgage: none of the documents the bank received said the mother’s signature was required. That loan was also a related-party deal, where the same person stands on both sides, which is where a second signature matters most.
The summary’s author suggests that farmers seeking financing in Iowa file a statement of authority in the county where the property is, which puts a lender on notice of who has actual authority. That is one state and one court. Whether a written rule binds a bank or an outsider is a question for a lawyer where your farm is.
Write the list of decisions that need two signatures, with the amount from which each applies, and ask a lawyer how to put it on record. Which decisions a manager may take alone is a separate paper, in what the manager decides alone.
What do you write first?
The register comes first, then the day of the monthly check on the calendar. The surprise check and the list of two-signature decisions can follow. That order is a recommendation. Who may pay what, and from when, also belongs in a written succession plan, so the check is agreed before the task changes hands.
Other records about the people on the farm are in the people section of the library, and comparing what is written with what is really there is a large part of farm management.