Financial Transaction Risk Management Penny Inc CFO’s Perspective
One of the most daunting tasks for CFOs operating in today’s financial environment is adequate internal controls over expenditure.
Lake Tahoe, NV (PRUnderground) November 10th, 2017
Traditionally, it takes many hours to classify employee and other expenses appropriately; all be it after the transaction has been effected and many more hours are required to verify that receipts have been kept according to tax legislation.
More often than not, expenses need to be re-classified / recoded once the receipt has been sighted as the expenditure was not classified correctly in the first place. Given that some of these expenses are small and by its nature don’t warrant the same scrutiny as large $ spends, they are often overlooked in the budgeting and approval process resulting in distorted financial reporting and an inherent risk for fraud.
The more small transactions a business has the more open it is to coding errors and fraudulent/non-authorised transactions being processed. Often, finance staff can only report ‘after the horse has bolted’, that is, the expense was incurred and paid for but may not have been a legitimate business expense.
Employees can be coached/reprimanded as the case requires, however, with Penny Inc it is possible to set a spending policy right from the word go. This eliminates a large degree of risk as spending has been pre-determined and authorised as per company policy. One of the favourite CFO examples ,which come up no matter whether an organisation is big or small, is the authorisation of travel expenditure for staff and executives.
Most companies have a policy that no alcoholic beverages are to be charged to the business; they are to be paid for by personal funds. Penny Inc assists this process immensely as all receipts, bills and transactions are detailed on its easy to use platform so even in cases where liquor expenditure has been incurred as part of an accommodation bill, finance staff can see in real time whether a staff member has breached the policy.
Learn more about Penny Inc’s cloud based expense management solution here: https://news.thepennyinc.com/expense-management/
Wolfgang Onuk, CFO, Penny Inc
About Penny Inc
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