Whether it’s online or in the real world, fraud prevention should be a top priority for any company, regardless of size or field. Even relatively “minor” cases of AP fraud can result in businesses losing tens of thousands of dollars.
Five Best AP Security Practices for Your Company.
1) Make staff aware of evolving AP risks
Last year, fraud related to billing was the most common type of AP fraud seen nationwide, according to the latest data from the Association of Certified Fraud Examiners. Not far behind, however, were issues like check tampering, improper expense reimbursement and skimming Unfortunately, companies that didn’t have significant fraud protection were hit twice as hard in terms of financial loss by these types of fraud.
As such, it’s vital for those with access to AP accounts, at any level, to understand these risks and others to make sure they can identify the potential warning signs of these types of fraud.
2) Add accountability
When employees spot potential issues with any account associated with the AP process, they need to be able to report it to the proper people within the company. Ideally, this reporting process would involve more than one superior, because unfortunately, KPMG found that most people committing fraud from within a company tend to be executives or directors who have been with the business for several years.
Therefore, having multiple people who will receive notice of suspected fraud could help to both get more eyes on the problem and protect against insider threats.
3) Build in safety checks
Along similar lines, when payments need to be made to other businesses, your company has a vested interest in multiple layers of approval to avoid fraud. While most people act with the best of intentions, security risks will still arise, and that could lead to fraudulent transactions. This MineralTree video explains why having more than one set of eyes can stop fraudsters in their tracks:
When more people have the ability to review any payment sent out, the additional layers of security keeps the process transparent. And with cutting-edge accounts payable software features, that extra protection is a mouse click away.
4) Train all staff in security measures
Hacking and phishing attacks are increasingly being targeted at small and medium-sized businesses, because criminals know they often don’t have the massive security budgets larger companies do. To make sure you’re protected, you need to train your staff in the ways to identify potentially fraudulent emails, regardless of whether they deal with AP specifically.
Often, all hackers need to get into a system is access to one person’s account, usually obtained by downloading a single file or clicking just one link, so everyone from the receptionist to the CEO must understand how to spot and deal with potential issues.
5) Get a bird’s-eye view
Investing in the latest accounts payable software and shifting more of your processes to digital is a great way to bring more protections into the fold. Documents are less likely to go missing, and there’s a clearer chain of custody that goes with an all-digital approach. That comes as a significant benefit in addition to the more obvious positives, such as increased efficiency and accuracy.
By working with MineralTree, those in charge of overseeing their companies’ accounts payable issues – whether they’re controllers or AP managers – can significantly reduce these risks. That’s because so many of MineralTree’s features are specifically designed to build in additional security that addresses many of the above risks.
Furthermore, your company can get more peace of mind with SIlverGuard, which provides fraud loss protection of up to $100,000 per year.
With new types of threats constantly evolving, companies need to stay on top of their game to detect and stamp out accounts payable fraud. A little attention in this area could go a long way toward ensuring they remain protected on an ongoing basis. To learn more, request a MineralTree AP automation demo today.