The accounts payable departments are one of the most vulnerable to frauds across processing ends. In 2021, some businesses across the U.S. had incorrectly in their accounts payable department provide a corporate checking account number to a fraudster posing as a vendor via a well-disguised email.
Few others had their automated clearing house (ACH) debit accounts wiped out after successful phishing attempts allowed hackers to deploy malicious software inside their internal networks.
This explains why accounts payable outsourcing needs to be done with utmost care and due diligence.
How Frauds in Accounts Payable Happen?
68% of organizations were targeted by business email compromise (BEC). In other words, through legitimate-looking phishing emails, employees were tricked into revealing confidential information or letting hackers gain access to sensitive financial data.
Accounts payable departments were the most susceptible to BEC fraud; 58% of respondents report that their AP department was targeted by email scams.
How to Opt for a Trusted Vendor for Your Accounts Payable?
Faster payment of invoices leads to improved relationships with suppliers and vendors and early payment discounts. Thus, accounts payable outsourcing increases margins by reducing administrative overhead while increasing productivity.
A clear understanding of the business drivers, such that the leadership team and Business Process Outsourcing companies’ efforts can be streamlined in that direction. Benchmarking an Accounts Payable organization to its peers increases the chances for more opportunities and spikes the Return on Investment.
According to American Productivity & Quality Center (APQC) benchmarking data, the top-performing Account Payable teams process 4x the invoices to the bottom performers.
However, along with efficiency, trust and security are the biggest challenges facing the industry.
The ARDEM SOLUTION
ARDEM caters to accounts payable outsourcing as a leading agent of change with various industry compliances in addition to its internal security measures.
PCI DSS 3.2.1
ISO 27001 (formally known as ISO/IEC 27001:2005) is a specification for an information security management system (ISMS). An ISMS is a framework of policies and procedures that includes all legal, physical, and technical controls involved in an organization’s information risk management processes.
AWS Secure Cloud Utilization
A SOC 2 Type 2 report is an internal control report capturing how a company safeguards customer data and how well those controls are operating. These reports are issued by independent third-party auditors covering the principles of Security, Availability, Confidentiality, and Privacy.
Sarbanes–Oxley Financial Compliance
SOX Compliance mandates strict reforms to improve financial disclosures from corporations and prevent accounting fraud. We support issues such as auditor independence, corporate governance, internal control assessment, and enhanced financial disclosure based on your SOX Compliance Protocols.
Efficiency, Cost Control and Security
In addition to offering back-office support services, ARDEM also offers Accounting, HR/Payroll, Billing, CRM, and Inventory Management. We provide businesses solutions that make them more productive and cost-effective.
Interestingly – The 2022 AFP® Payments Fraud and Control Survey reports 71% of organizations were victims of payments fraud attacks/attempts in 2021. This is the lowest level of fraud reported since 2014. Of those respondents whose organizations reported an increase in fraud, 47% do not believe that remote work is to blame for the increase.
The Outsourcing accounts payable offers numerous benefits, such as increased visibility into cash flow, reduced paperwork, faster response times, lower operating costs, and improved customer service. Moreover, AP outsourcing frees up internal resources to focus on core operations.
However, before implementing any outsourced solution, it is essential to discuss and agree upon a formal policy, establish KPIs, and implement controls.
ARDEM provides Business Process Outsourcing and Business Process Automation Services to established companies to help them improve operational Efficiency and Reduce Costs. For more information please reach out to us at firstname.lastname@example.org or call us at 908-359-2600.