<img alt="" src="https://secure.leadforensics.com/125734.png" style="display:none;"> Stop fraud with technology (or lose another billion dollars)

Stop fraud with technology (or lose another billion dollars)

Stop fraud now!

Organizational fraud is often possible when there are no clear procedures. It allows decision-makers to get into a position where they can abuse their power. However, for procurement fraud this is largely preventable with the right purchase-to-pay software. Through limitation of individual powers, secured processes and payment controls.

Limit the power of individuals

In most organizations, it is required that different people approve purchases before they are made. The first step in preventing fraud is to implement this so called segregation of duties in a way that there is no way around it.

By way of example: A buyer should never be given full power to submit and approve the purchase himself. As a rule should the buyer’s manager be obligated to check the purchase. Even when the most senior manager initiates a purchase, someone else will be required to approve. With purchase-to-pay software, these roles and dependencies are easily set-up and you can trust the software to follow these rules.

Protect the Procurement

Implementing this segregation of duties is worthless when the procurement process is not sufficiently guarded. The approval workflow in purchase-to-pay software maps all the steps and anchors them so they can’t be avoided. All approvals, remarks and actions that a purchase goes through are archived in the system, attached with the approving user, timestamp, and other data; a complete audit trail.

The workflow can never waived by anyone and no order goes unnoticed. Whenever an employee goes on holiday, the responsibilities can be temporarily transferred to a colleague.

Introduce automated payment control

Fraud customarily comes to light when it’s already too late; at a year-end closing, another periodic report, or through an accounting change. Because fraud often takes place after a PO is already approved, through a simple change of bank account for instance, a decisive action is to validate payments before they go to the bank. In the end, this is the last moment to prevent it before the fact.

Automated payment control verifies that the payments sent to the bank correspond to what has been authorized based on the invoice.

Getting rid of fraud

Ever since the first recorded fraud case in 300 B.C.–when the merchant Hegestratos took out an insurance policy and was caught trying to sink his own boat–have people committed fraudulent acts and gotten away with it. The more wealth there is, the more that can be embezzled. And yet, there are more possibilities to stop fraud than ever before.

Admittedly, it’s not (yet) possible to completely eradicate fraud. But using today’s available technologies, we can make fraud much more difficult and better traceable. Investing in fraud prevention makes the organization better protected and minimizes malpractice.

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