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Fraud

Is Purchase to Pay Fraud Impossible to Prevent ?

Sometimes it seems that fraud in Purchase to Pay must be impossible to prevent. Almost every week at PPN we report on fraudulent activity across finance, procurement, AP and related departments – each one often bearing a very similar traits to the last.

Fraud feeds off weak controls

No-one likes to think that their organisation, or their department could be at risk from fraud – yet the fact remains that AP is one of the most vulnerable departments in this area. Quite simply, the people who work there have easy access to all the money leaving the company. So it’s in your interest to learn to detect the tale-tale signs that something suspicious is going on.

How well do you know the person in charge of your MSF?

They say things come in threes – but when during the course of one week, that “thing” is fraud – it’s probably time to sit up and take notice. And there are probably two or three factors which may be at play here – 1) fraud is being carried out more frequently than before 2) our methods of catching it are more robust than before, or 3) perhaps organisations are not so prepared as they were to sweep fraud under the carpet in a damage limitation exercise. Most likely it’s a combination of all three.

Trust, Shame and Reputations - Truth & Lies in Today's AP

It’s comforting to think that if fraud exists, it exists elsewhere – anywhere in fact other than right now - in your organisation and your own department. And in fact, it’s that assumption which makes life a whole lot easier for those hoping to embark on a life of AP crime.money-image

Of course, no-one likes to think that someone they work with could be capable of fraud, and yet the truth is – fraud happens – and it happens quite a lot. And you’re not looking for a shady character in a badly judged mac with dodgy eyebrows. Statistically it’s likely to be “John” who’s worked for the company for the last 15 years. Perhaps “John” feels entitled after all the unrecognised hard work he’s put in. Perhaps it’s his way of righting a long standing wrong. Who knows.. but most of all – John is doing it because he can.

Without a Trace – Where did all the Money go?

In many ways, overpayments in an organisation’s ERP system are intangible, not noticed – and if left for too long – unrecoverable. It remains a fact that if you’re processing over 25,000 invoices a year, you will also be processing duplicates. The supplier may highlight the error, but often it’s either overlooked by both parties, or deliberately ignored. In the latter case, it’s interesting to note that this is often not thought of as fraud by the guilty party. Of course the onus should be on the buyer to ensure that their payment process is correct, but if the supplier notices, and then does nothing, then that is another issue entirely.

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Avalara

Avalara helps businesses of all sizes get tax compliance right. In partnership with leading ERP, accounting, eCommerce and other financial management system providers, Avalara delivers cloudbased compliance solutions for various transactional taxes, including sales and use, VAT, GST, excise, communications, lodging, and other indirect tax types. Headquartered in Seattle, Avalara has offices across the U.S. and around the world in Canada, the U.K., Belgium, Brazil, and India.