5 TIPS TO PROTECT YOUR CONSTRUCTION BUSINESS AGAINST FINANCIAL FRAUD Presented by Rhonda Greene Sponsored by
MEET YOUR SPEAKER Rhonda Greene, APSC Principal Solutions Consultant AvidXchange
Current Challenges Understanding How to Save Time Q&A in Construction AP Cybersecurity & Increase Threats & How to Efficiencies Mitigate Risks
CHALLENGES IN CONSTRUCTION 43% 45% 50% More than two out of five Nearly half of construction said automation technology would construction professionals (43%) professionals report there are be extremely helpful in preparing say the biggest hindrance to three processes still dependent on for future business continuity automating business processes is paper based or manually created needs. that there are too many systems electronic files that do not integrate.
CONSTRUCTION CHALLENGES IN AP Intaking Capturing Matching Reporting Approvals Invoices Data • Filing cabinets • Received in a • Non-standard • Invoices must be • Tracking down and stacks of huge variety of data means matched to the right paper formats manual data purchase orders/ approvers is time • Fragmented and entry to ERP contracts consuming • Invoices are not siloed systems standard across • Costly manual • Errors add • Slow process • Manual data suppliers process manual results in missed entry and reconciliation/ discounts / late • Prone to errors increased resolution payments likelihood of error
ESTIMATE THE NUMBER OF VENDOR PAYMENTS YOU MAKE IN A MONTH? A. LESS THAN 100 B. 101 – 250 C. 251 – 500 D. 501- 999 E. 1000+ 6
OPERATIONAL EFFICIENCY IS COMPLEX Visibility and control Increasing revenue Offloading laborious Implementing while managing cash over spend tasks efficiencies into flow and working business processes capital
YET… MOST B2B INVOICES AND PAYMENTS ARE STILL PAPER BASED.
74% $3-7 of companies Total cost of processing experienced actual or a traditional check attempted check fraud We looked at this and realized, people's lives are better without the paper check.
CYBERSECURITY, FINANCIAL FRAUD & RISK MITIGATION
CYBERSECURITY A cybersecurity threat is a malicious act that seeks to damage data, steal data, or disrupt digital life in general. Crimes include email phishing campaigns, in which malware is activated when a recipient clicks on a malicious file or link sent via email. $3.9M is the average total costs of a data breach
IT’S ON IS ON THE RISE 400% Spike in cybercrime activity related to this year’s global pandemic, according to a recent study.
OCCUPATIONAL FRAUD Occupational frauds are those in which an employee, manager, officer, or owner of an organization commits fraud to the detriment of that organization. The three major types of occupational fraud are: Corruption, Asset Misappropriation, and Fraudulent Statements. $200K 24 months is the average is the average length of time it median loss the usually takes for a company to construction notice occupational fraud is market experiences occurring. with occupational fraud
OCCUPATIONAL FRAUD IS RISKY BUSINESS TO TOP 4 4 CONSTR TRUCTI TION FR FRAUD 1. Corruption: 47% 2. Financial Statement Fraud: 25% 3. Billing Fraud: 22% 4. Check and Payment Tampering: 17%
7 KEY WARNING SIGNS OF OCCUPATIONAL FRAUD 42% 19% 13% 26% 15% Living beyond Unusually close Financial Control issues, Irritability, their means association with difficulties unwilling to suspiciousness vendor / share duties or or customer visibility into defensiveness work
HOW OFTEN DOES YOUR BUSINESS EDUCATE ON SECURITY MEASURES WITHIN YOUR ORGANIZATION? A. WEEKLY B. MONTHLY C. QUARTERLY D. ANNUALLY E. RARELY OR NEVER
HOW TO MITIGATE RISKS Formulate & Identify & Define risks & deploy understand impact on the methods to your risks process mitigate risks
COMMON INEFFICIENCIES IN ACCOUNTS PAYABLE Inconsistent & slow processing Paper-based processes Lack of storage & inability to access outside the office Poor data entry
WAYS TO STREAMLINE 01 02 03 04 Set up custom workflows Store information securely Set up pay controls, or Utilize financial technology, in the cloud triggers for high value, high like AP automation software dollar transactions
FASTER IMPROVED INVOICE STRAIGHT PROCESSING THROUGH PROCESSING REDUCED ERROR MORE TIME FOR COSTS STRATEGIC USE REDUCTION
Continuing to do today’s job Security is paramount with yesterday’s methods delays profitability for business tomorrow . A new era of employees want to elevate their value and refuse to “push paper” Business who navigate the transition from manual to Outsourced services are becoming modern payment systems are a common way of doing business poised to win Organizations must be ready to grow with or without extra headcount Online, mobile and real-time information are must haves
POLL QUESTION WHAT IS YOUR NEXT STEP? A. I’D LIKE TO SEE A CUSTOM DEMO. B. I WANT MORE INFORMATION ON AP AUTOMATION. C. I AM JUST HERE TO LEARN 22
Q&A SESSION To submit a question for Jim or Michele, type it into the chat. 23
THANK YOU FOR ATTENDING! Look for an email from us about how to view playback and download a copy of today’s presentation. For more helpful webinars, visit constructionbusinessowner.com. 24
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