Bribery Act 2010: A New Threat Or An Untapped Opportunity?

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As the festive season sends Travel & Entertainment costs spiralling, Sanjay Parekh, MD at WebExpenses, asks whether the 2010 Bribery Act could be a blessing in disguise for businesses.

WebExpenses is an award winning provider of web-based expenses solutions software serving customers across a diverse range of industries and sizes. WebExpenses was set up to offer a simple, innovative solution to the often manual and time consuming task of managing expenses.

Trusted by over 300 clients and used by thousands of employees in more than 60 countries, WebExpenses’ award winning expenses solutions processes £millions in travel and entertainment (T&E) spend a year. Customer implementations range from small organisations with a handful of users to those with several thousand users scattered across multiple divisions across the globe. Delivering rapid ROI, WebExpenses helps organisations increase efficiency, control employee spend and drive down operational costs.

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Bribery Act 2010: A New Threat Or An Untapped Opportunity?

  1. 1.  Deloitte’s latest survey of British businesses indicates – ◦ Trail of missing receipts ◦ Unchecked expenses claims ◦ Lack of transparency and control over employee expenses ◦ Mass bribery and fraud on the part of employees British companies are missing out on massive travel discounts due to inadequate expenses monitoring
  2. 2.  The accounting body found that ◦ Less than 2% of claims are investigated ◦ 20% of companies have no policy mandating that expenses must be checked by senior staff ◦ Almost 50% of them have no limits on expenses ◦ Widespread fraud is costing British businesses over £1.3 billion a year
  3. 3.  Bribery Act 2010 sheds light on employee expenditure It blurs the legal boundary between corporate hospitality and bribery; distinction between active corruption and the failure of company directors to prevent it has now been eliminated It applies to companies with virtually no connection to Britain, other than a listing on the London Stock Exchange 25% of all businesses recently admitted they would be unable to account for all their employee expenditure before HMRC
  4. 4.  The Act has triggered panic manoeuvres amongst multinationals. Companies are struggling to keep up with the pace of regulatory change and seamlessly integrate new laws into their accounting processes World Check points out that S&M Enterprises could be at greater risk, due to their reliance on third parties, intermediaries and agents to conduct offshore operations Failure to monitor and control expenses is putting businesses at legal risk and jeopardising their financial recovery
  5. 5.  This Act has a provision for unlimited fines and 10-year jail terms for potential transgressors With these changes the Serious Fraud Office’s punitive umbrella has widened to include any bribes taken or received from individual employees and private companies Section 7 not only holds company directors personally responsible for any suspicious spending across all of their international divisions However, there is a risk that employees buying innocent client dinners could be tarred with the same brush as those who use “T&E” budgets to conceal illicit activities
  6. 6.  Too many firms rely on paperwork and inefficient manual methods of entering, filing and processing claims, leaving an invisible money trail, shrouded in an unchecked backlog of spreadsheets, stapled receipts and forms There is a real opportunity for businesses to make financial gains and protect themselves from prosecution But this would require Finance Departments to radically alter the way they operate
  7. 7.  The question is how they can cut both admin and labour costs, and improve transparency and control over expenses They can defend themselves against false accusations - ◦ If they can prove they communicated the law to staff and took “appropriate measures” to enforce the rules ◦ If they can account for their expenditure across all international divisions
  8. 8.  Innovations in cloud-computing technology are at the forefront of the renewed drive for financial transparency in employee expenses and control over employee activity Companies can enforce compliance with new laws such as the Bribery Act, by allowing employees spending to be monitored in real-time from any location, with receipts and evidence saved in a single, safe online repository
  9. 9.  Instantly incorporate new laws in its calculations Cuts the massive burden of expenses management and compliance with new regulations by 50% Automates the painstaking process of checking individual receipts and claims for compliance with existing laws Red-flags any employee claims which are erroneous, do not comply with the new policy or exceed the company expenses limit for each tier of employee Gives instant overview of the entire money trail across all departments, subsidiaries and individual employees
  10. 10.  Employees can easily enter claims and evidence from remote locations through smartphone apps that incorporate different currencies, tax rates etc. in its calculations Spending details are collected straight from company cards and instantly added to centrally located company accounts The FD has instant access to all data via a live portal and can understand different spending patterns across their global divisions GPS technology helps in reducing travel fraud by calculating mileage
  11. 11.  The implementation of WebExpenses software deters fraud and fosters a culture of transparency Businesses can now take advantage of the latest Bribery Act and other such laws to regain control over their expenditure Corporate FDs can repair their reputation, prevent harmful prosecutions and cut the crippling burden on the organisation as a whole Equips FDs with the credibility and confidence to face HMRC with up-to-the minute records
  12. 12.  Eliminates the problem of paper receipts lost in transit, compelling employees to enter claims as soon as costs are incurred Point of entry policy reminders so you can communicate your bribery policy when entertainment expense is being input Attendee details can be set as required fields on all client entertainment expenditure, ensuring the user stipulates who, why the user has entertained and how much was spent
  13. 13. Contact Us – Website – http://www.webexpenses.com/ LinkedIn – http://www.linkedin.com/company/WebExpenses Twitter – http://twitter.com/WebExpenses Facebook – http://www.facebook.com/WebExpenses YouTube – http://www.youtube.com/user/WebExpenses

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