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Vendor Risk Management

May 3rd, 2023
by Tony.
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Many organisations have fallen victim to unforeseen supply-chain disruptions and vulnerabilities in the last decade. If a business can identify and mitigate Vendor risks effectively, it can ensure a smooth supply-chain management system and evade substantial losses that such events may trigger. This article will debate how a business can identify Vendor risks and alleviate their effects before any damage is done.


What is Vendor Risk Management?
Vendor risk management is a methodical approach to identifying, assessing, and mitigating any risk to supply chain management that may arise from the actions of the Vendor.


How to identify Vendor Risks
If an organisation wants to quantify risks, the ideal way to do so is by classifying them into two groups:

Known and Unknown Risks.
Unknown risks are the ones that are almost impossible to foresee. For example, a tornado destroying your Vendor’s warehouse can negatively impact your supply chain, and it’s hard to predict the intensity of a natural calamity until after it has occurred. In the same way, a cybersecurity vulnerability buried deep inside a critical electronic component of the Vendor’s system can shut down its operations without warning.

When handling unknown risks, the best strategy is to reduce their probability and increase your response time to maintain a competitive advantage.

Known risks can be recognized and measured- this means they can be managed over time. For example, Vendor bankruptcy is a known risk that can disrupt the supply chain. A business can assess its likelihood by analyzing the Vendor’s financial history and credit rating.
Similarly, cybersecurity breaches are newer risks that can be quantified by analyzing a Vendor’s IT system.

How can you manage unknown vendor risks?
Alleviating unknown risks is achievable by setting up robust defenses and building a risk-aware organisational culture. A strong culture ensures that defensive layers are in place to respond quickly when an unknown risk materializes and threatens to disrupt operations.

How can you manage known vendor risks?
Organisations can use a structured problem-solving procedure to manage their known risks effectively.

⦁ The first step is to map out and evaluate the supply chain of your products. Each Vendor in the supply chain should be identified, along with the risks to which they expose your business.
⦁ Regular monitoring of the framework is a critical success factor in Vendor risk management. An early warning system should be set in place to track top risks.
⦁ Constantly improve the agility and resilience of the supply chain.
⦁ Build a Vendor risk management framework where each risk is scored according to its impact, likelihood, and the organisation’s preparedness to handle it.

Finally…
As supply chains become more global, the risk associated with Vendors multiplies.

Organisations must map out a systematic approach for Vendor risk management to avoid losses and ensure smooth operations.

For more info please go to: https://fiscaltec.com/supplier-risk-management/

Accounts Payable Audit Software … Gives You Advantages

Feb 12th, 2019
by Louise.
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There’s a maxim that businesses that start in a recession tend to be leaner and tougher than those which get going in easier times. The same is broadly true, though to a lesser extent, of businesses that survive a recession. Some make it because they slim down and make every pound count; others only because they have reserves to rely on and not because their model is sound. Either way, a recession is a good time to make sure that waste is at a minimum and you are making the most of every opportunity. That goes for your accounts as well as advertising and product design or service provision. An accounts payable audit can show up where you have been going wrong for potentially years, without realising it – those areas such as duplicate payments where you have been throwing money away, solely because your accounts processes aren’t up to the job of pinpointing where errors and fraud are most likely to occur. Thus recovery audit software can have two helpful purposes: it can enable you to reclaim money lost in past overpayments, and it can help protect you from making the same mistakes again in the future.

When a company starts out, its accounts might be quite simple. A relatively small number of suppliers and clients (perhaps just one of each), and small, predictable payments. That’s easy enough to keep track of, but when your business grows you might find yourself adding new clients and complexity to a system that was never designed to keep up with it. That becomes time-consuming to administrate, for starters. Unfortunately, it also becomes vulnerable to errors, and even fraud. Even a single invoice itself is quite complex, with maybe a dozen different fields of data. The scope for discrepancies is large, and multiplies with the number of clients you have. Plus, some will always be unscrupulous and willing to see whether they can take advantage of your system’s inadequacies by filing duplicate invoices.

Duplicate payments represent the single largest category of overpayment, but there are many others. That’s why recovery audit software is so vital: it enables you to find exactly where the errors are creeping in, and to plug the gaps. Given that an estimated 0.1 percent of payments are spurious, an accounts payable audit can save a lot of money – especially if your business thrives on high numbers of transactions. In fact, it can make all the difference between going under and staying afloat – and will stand you in good stead for when the economic climate improves.

More at:  http://www.fiscaltec.com/uk/

Minimise Duplicate Payments Risk with software from Fiscal Technologies

Apr 15th, 2018
by Anna.
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As with every step forward and with the crossing of each new frontier, the constant development of business and the constant development of accounting technology and multiplication of business models and practices presents firms with new challenges and new problems. Your Accounts Payable department is now a hugely more complex beast than its predecessors of even a decade ago were: and it is charged with burdensome and serious new responsibilities. What’s more, any increase in the size of your AP department, let alone in its complexity, inevitably opens the door to an increased threat of faults: and they can add up. The new complexity and diversity of the ways in which AP departments receive payments has created mind-boggling new tasks and this means new dangers of things falling between the cracks. In a more complex, modern department, old problems like fraud, duplicate payments and overpayment still loom large, but in new ways

Rubbing out everyday errors like duplicate payments, faulty procedures or even failures to get the most out of the programmes that you use demands proactive self-auditing. In order to really get to grips with the challenges of a modern and expanding AP operation, you need an excellent Accounts Payable audit system. That’s where Fiscal Technologies AP Forensics software service comes in. AP Forensics is an easy-to-use system which can give you an oversight of your whole AP operation from A to Z.

The technology choices that businesses make are now crucial to the success of your accounts payable audit operation. The recovery audit software that you use has to be absolutely top of the range or else it is simply useless. Fiscal Technologies accounts payable audit software package AP Forensics falls firmly into the former category. One of AP Forensics greatest virtues is its simplicity. The system is designed to be as straightforward and intuitive for AP professionals as possible, so that information gleaned from your AP Forensics audit can be quickly converted into effective corrective action.

Accounts Payable Audit software isn’t the only important weapon in Fiscal Technologies armoury. Recovery audit software, designed to assist with recovery of money lost through overpayments or other errors which are detected after the transaction has been completed, is a vital tool: AP Forensics has the software solutions that are needed for effective recovery audits, as well as audits of your AP department’s procedures.

Fiscal Technologies’ decade of experience in the AP field points to the fact that if your staff are not adequately motivated; or if they are not suitably prepared for the fast pace of technological and organisational change, then even the most well-meaning management strategies for improving AP will leave your team feeling shell-shocked rather than empowered. AP Forensics is the software package that you need that can deliver the clear information and hard facts that AP teams require to navigate their way confidently through the changing AP environment.

Please visit http://www.fiscaltec.com/uk

Bacs software makes accounts a lot easier

Mar 4th, 2011
by Anna.
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Bacs, or Bankers Automated Clearing System, has now been around since the late 1960s. It is the UK’s system of making electronic financial payments. Bacs payments mean that you can provide a department with your bank details – account number and sort code – and have money paid directly into your account. This clearly has numerous advantages. Speed is one of them – bacs takes place almost instantly in a lot of cases (although this depends a lot on the banks in questions – certain transfers between some banks can be extremely speedy, whereas others can take three working days, which is the standard time quoted in the industry). In any case, even the three-day limit is probably as fast, in many cases, as paying in cash or a cheque and waiting for it to clear. Convenience is another benefit – it decreases trips to the bank, and therefore leaves more time for other activities. Security is another obvious one; it stops the need to have large quantities of money on the premises, which might be a particular problem on payday. In the past, this would have meant that the entire company’s payroll was present – a clear risk. bacs software can therefore be a huge advantage for modern firms.

If you operate a small business – or anything larger – you will likely benefit from incorporating such bacs software into your accounts department. Automating invoice payments significantly simplifies the monthly (or more regular) task, since everything can be automated to the required degree. This means that you don’t have to do the job yourself. Even if you still use online banking, thereby avoiding the issues with writing lots of cheques or, worse, handing out physical cash, setting up and paying all the amounts can be a time-consuming process. It’s also likely to mean a lower degree of mistakes, and therefore less problem with duplicate payments, fraud and other issues than can reduce your profit margin through poor accounting procedures.

Bacs is fast and easy (SWIFT, a faster version, guarantees same-day payment, for a fee). Bacs payments have so many advantages that it’s worthwhile for any business to explore bacs software as an option for paying clients and suppliers. In the 21st century, cheques and cash are less and less common payment methods, and the future of the cheque itself is becoming increasingly uncertain. Simplicity, security and reliability are three reasons to look into the idea more closely, if you haven’t already.

Please visit http://www.bottomline.co.uk/ for further information about this topic.

http://www.bottomline.co.uk/

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Bacs software is vital for your business

Aug 18th, 2010
by Anna.
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BACS (which stands for: Bankers’ Automated Clearing Services) is a handy way to transfer money from one bank account to another. Bacs payments normally take three working days to clear. On the first day the order enters the bank’s system, on the second day it is processed, and on the final day the payment is cleared. Many companies make use of bacs software in their accounts departments to streamline the way in which they process financial transactions. This automated clearing service for processing financial transactions is often the method by which employers choose to pay their employees their wages and it has proved extremely useful since its invention over 40 years ago.

The Bankers’ Automated Clearing Service was invented in the UK by Dennis Gladwell. The service was started in 1968 in order to reduce the need for paper documents and contracts to be used during the process of transferring money between bank accounts. It has remained true to this concept ever since. In recent years, however, it must be acknowledged, there has been some criticism of the system because of the length of time it takes to process a financial transaction. Some organisations would like the process to be quicker.

The Bankers’ Automated Clearing Service has changed in some ways since its inception. Since 2003 the Bankers’ Automated Clearing Service has been moving from a telephone dial-up service (BACSTEL) to an internet-based service known as BACSTEL-IP. And when BACSTEL-IP was launched it was determined that all software which is used to make a connection to the clearing service had to have approval from the clearing service itself.

Software which is used to manage payments is a real advantage for businesses that frequently use the Bankers’ Automated Clearing Service. Any successful business, whatever size it may be, and regardless of which industry it is operating in, understands the importance of having secure systems for processing financial transactions. Tight control of a business’s financial transactions is vital for strategic planning and maintaining cost-effectiveness. BACS software enables businesses to follow payments and improves the auditing process.

In order to ensure that payment process management within a company is efficient and secure, the type of software described above can be tailored to suit any size of business and to almost all requirements. Using bacs software, a company’s financial officers will be able to make fully informed decisions about the state of the company’s finances. Bacs payments are an integral part of the daily life of many companies and many of these see the benefits of using software to manage the process.

Please visit http://www.bottomline.co.uk/ for further information about this topic.

http://www.bottomline.co.uk/

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