Fraud and Compliance

Asking the Experts About… Compliance

Mia Raymond |

Compliance is a hot topic as businesses try to clamp down on out-of-policy spend and reduce risk. Our Ask an Expert: Compliance webinar has the lowdown on exactly why this is so important and explores the results you can achieve with an automated audit process. Part of our Ask an Expert series, these 30-minute sessions provide invaluable insights by sitting down with topic experts and getting some important questions answered.

Emily Gosling, SAP Concur Compliance Consultant, EMEA, introduced the webinar by saying, “Although most organisations understand the risks they face when it comes to occupational fraud and compliance, it can be a very touchy subject for them and we understand that.” The aim of the webinar is to combat some of these concerns, break down the obstacles to combating fraud and provide tips on how organisations can alleviate risk.

We’ve highlighted some key insights from the webinar that we hope will get you on the path to a risk-free expense process.

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We’re all aware that since 2020 business spending habits have changed. Whether it’s small changes like new working from home or PPE expense types, or larger changes such as scaled-back business travel, the ability for your organisation to stay on top of shifting expense behaviours is increasingly important. The risk of occupational fraud, which has always been a tricky subject, is further complicated by these changes.

If we look at this report by the Association of Certified Fraud Examiners (ACFE), we see that 14% of occupational fraud is tied to expense reimbursement. What’s perhaps most alarming is that, on average, it takes businesses 24 days to identify fraud, by which time the claim has been submitted and often reimbursed. This is too late for your business to do anything about it, which puts you at risk of fraud. The question many organisations are asking is: “How is this happening?”

Find the various non-compliant activities to watch out for in this eBook, from sneaking new expense types that aren’t within policy, to things like padding out mileage and claiming duplicate payments for a shared meal.

“What’s most interesting is that 12% of employees don't do anything to try and conceal fraudulent activity, but it's still not being identified. Just imagine the risk that percentage could pose to your business,” Emily Gosling warns.

The Bucket List of Compliance

Although it’s a touchy subject, most businesses are aware of the urgency of rooting out fraudulent spend. The most obvious reason is financial – non-compliant spend eats away at the bottom line. There are also the legal ramifications if you fall foul of government regulations. Finally, there’s the reputational damage of being associated with fraud including the loss of goodwill with partners, stakeholders or employees.

In the webinar, we look at what we call our compliance “buckets”. The first is where we put specific audit rules – those questions you need to ask to set expectations from the get-go. “This step is your chance within audit rules to ensure that certain justifications are made prior to submission, so you eliminate back and forth and can focus your time on other more important activities,” says Emily Gosling.

Next up is the pre-payment audit “bucket” where we place preventative measures that put a hard stop to fraudulent and non-compliant spend. As Emily Gosling explains, “This is where you review everything on a transactional basis, so that you can ensure there's nothing crucial slipping through the gaps.”

Finally, the third “bucket” is where we store the bigger picture of your compliance programme, an area Emily Gosling says is “often swept under the rug but is a crucial step in ensuring you have a secure compliance programme.” Here we analyse those items that maybe don't pose much threat at a prepayment level but are still important to track to optimise your policy.

Emily Gosling gives a real-world example of an employee who, at the pre-payment stage, never steps outside of policy and always submits their dinner expense within a £30 limit. Looking closer, we notice that their expense report always comes in at around £29, very close to the limit. The employee is technically, at pre-payment stage, doing nothing wrong, but there could be bigger issues at play.

Best-In-Class Compliance: How Low Can You Go?

Unfortunately, no matter how secure your programme is, you're never going to eliminate 100% of non-compliance. Policies change, employees come and go and human error will always play a part. Our best-in-class level of non-compliance is 15% and it’s achievable with the simple addition of an automated audit tool – the SAP Concur Sample Audit is a great place to start.

During the webinar, we get a sneak peek at one customer who prior to the SAP Concur Sample Audit process experienced 71% exceptions per 500 expenses. Following the implementation of a SAP Concur audit solution, this plummeted to 46% within one month and to our best-in-class of 15% within six months.

You don’t have to wait long to get started. The sample audit process has a two-week turnaround, depending on the waiting list. If you go one step further and introduce Intelligent Audit, leveraging both AI, machine learning and human auditors, the audit process takes on average 48 hours, and only a matter of a few minutes if just the automated component is required. As a bonus, the reporting tools within Intelligent Audit allow you to address your specific issues, whether that’s inaccurate mileage claims or corner-cutting line managers.

All in all, the right audit process takes pressure off end users, line managers and finance teams, while reducing risk and cutting costs within your organisation.

To find out more best practices, tips, and tricks, and get answers to audit-related questions, register now for the Ask an Expert: Compliance webinar

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