The Commerce Department estimates that 15 percent is added to retail good costs because of employee theft and 75 percent of inventory shortages is directly attributable to this crime. Because thieving employees are so inventive in their methods, many operations are using sophisticated, computerized, point-of-sale (POS) registers to monitor merchandise flow. However, managers should institute a manual backup system because many young employees are computer-literate and able to outwit computers as well as lockout features. Tight operational controls include automatic alarms, surprise audits, surveillance of inventory, cross-checks of voided items, limited employee ingress and egress, random checks, and strict cash handling procedures. In developing honesty tests, managers have found three key factors in employee theft -- need, opportunity, and personality dimensions. Job application forms, attitude surveys, initial interviews, reference checks, and second interviews are good screening procedures for new applicants. When combatting employee theft, managers should use a post-employment attitude test to narrow the list of suspects, check internal systems to see where theft could be occurring, and employ an investigative agency to prove guilt. Finally, dishonest employees must be punished in order to create a corporate environment where honesty is fostered.