Finance teams have witnessed a 6% increase in reported input errors during invoice processing and a slower rate in the reduction of other processing errors over the past 12 months. This is according to FISCAL Technologies, the leading provider of Procure-to-Pay (P2P) risk management solutions, which analysed its UK customers’ data* from the last two years to understand the true impact the COVID-19 pandemic has had on finance teams.
Crucially, FISCAL’s analysis found that across all sectors, the number of risks detected rose year on year by 20% on average, with the highest rise being 37% in manufacturing. In terms of risk value detected and prevented, the average increase across all sectors was 70% – a total of £240million in the 12 months to 23rd March 2021.
Ray Welsh, Head of Product Marketing at FISCAL Technologies says, “When the first lockdown occurred last year, there was much speculation over what would happen – organisations were worried about processes without access to paper documents, and were rightly concerned about how remote working would impact security. But we quickly saw that the finance team is more resilient than first thought and the knock-on impact of the pandemic wasn’t as huge as originally predicted.
“However, our data analysis did find that the rapid changes resulted in an increase in invoicing errors. Furthermore, the reduction in other processing errors declined at a 6% slower rate in the 2020-2021 period, compared to the same time the previous year. These insights clearly demonstrate that the move to working from home and a change in processes as a result of the pandemic led to gaps in existing control processes.”
Ray explains that with many organisations now considering more flexible working policies post-pandemic, this is an issue that organisations must address: “Protecting the bottom line is always of the upmost importance, and as businesses rebuild and recover following the turmoil of the past year, it’s essential that they have the best measures in place to help them achieve this. Because of the rapid changes that had to happen last year, there will be an element of acceptance of some errors, but now that teams have settled into the ‘new normal’ this will not be acceptable going forward.
“Organisations need to ensure that their finance teams have the right tools to empower them to continuously and proactively generate cash, reduce costs, and protect their P2P processing, whilst providing assurance to the business that strong financial controls are in place.”
FISCAL Technologies’ unique solutions, built on over 17 years of experience reduce costs using the latest forensics and AI to uncover hidden costs and generate valuable working capital, and provide continuous actionable insights – that drive process improvements and secure the Procure-to-Pay process. Additionally, it checks 100% of transactions 100% of the time, meaning exceptions are discovered quickly and efficiently.
Ray concludes, “The prolific risks and demands on the Finance department, and the greater emphasis on saving and protecting working capital, means that forensic insights and protection of finances have never been so important.”