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Fraud risks dominate financial leadership research PDF Print E-mail
Wednesday, 30 August 2017
GREENSBORO, N.C. – August, 2017 – APEX Analytix, the industry leader in software and service for the global financial supply chain, raised a warning, today, based on new research, that businesses are dangerously open to payment fraud. Accounts Payable (AP), Procure to Pay and Shared Services departments have a long way to go to fully safeguard themselves against major fraud risks. 

The Financial Leaders’ Benchmarking Report, released today, gives the definitive view on best-in-class organisations and performance gaps across AP and Shared Services. 170 organisations from the Global 1000, with a combined revenue of $2.1 trillion, have contributed to the report, sharing how they address supplier and employee risk as well as operational performance, electronic invoicing and payments, discount capture and the alignment of Shared Services to the strategic objectives of the business.

The report reveals a troubling lack of integration and visibility across teams. 54% of AP departments reported that they don't partner closely with internal audit and 82% are not connected to corporate security. 51% of businesses don't require a secondary review of high value payments, and 79% of businesses don't cross-check their employee records against their vendor data, to ensure employees are not posing as suppliers.

When it comes to fraud associated with vendors, the holes are just as large. 65% of businesses don't authenticate vendors against external data sources and only 14% capture verifiable details of a vendor’s beneficial owners and officers. Other gaps were revealed by the fact that 11% of businesses review high-risk vendors only once a year - and 15% don't do so at all. More concerning is the revelation that in the average business, more than a third (36%) of payments aren't associated with purchase orders or contracts.

“We have been benchmarking AP organisations for over 20 years and the gap between the highest and lowest performing organisations is getting bigger. Our report offers a comprehensive insight into what the best in class performers are doing to address their exposure to risk, as well as how they are optimising cash flow and moving towards becoming a profit center. The worrying revelations are the gaps in some organisations that are leaving the door to the vault wide open,” said Phil Beane, SVP, Global Operations, APEX Analytix.

“The good news is we’re also seeing the world’s best organisations continue to improve with an increasing focus on supplier information management initiatives that provide robust, automated governance, risk management and compliance, which is adding value both strategically and operationally.”
 

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