Most companies are in dire need of employees who aren’t afraid to speak up when it comes to financial improprieties at work.

Four in 10 workers have witnessed misconduct in the workplace. And nearly a quarter of those fail to speak up about it.

Those eye-opening stats come from several recent business ethics surveys highlighted in a new report by the Anti-Fraud Collaboration.

Here’s why you can’t afford to let anyone see something and say nothing – and how you can create an environment of Silence Breakers.

Because if it happens once …

The most compelling reason you need people to speak up: Odds are whatever the person did once – be it expense report padding or buddy punching – he or she is likely to do it again.

Nearly half (41%) of people said they saw the same behavior at least one additional time. And often it was a pattern repeated consistently.

So every time someone doesn’t speak up, it costs you more and more.

Why do people hesitate to call out funny business? Yes, fear of retaliation is the No. 1 reason. But there’s a whole host of other things you might not even realize could be suppressing employees’ willingness to come forward:

• Management doesn’t want to hear problems. You’ve heard it before; maybe you’ve even said it: “Don’t bring me problems, bring me solutions.” Some employees may take this to mean managers never want to hear negative news.
• Excessive team loyalty. Of course you want employees who are loyal to their department and the company as a whole. But that can be taken too far when folks choose to overlook bad behavior “for the good of the team.”
• A “results at all costs” culture. Again, you certainly want everyone to be focused on driving the numbers, but that too can be taken too far. For example: When someone doesn’t report overtime worked and a colleague doesn’t correct it or speak up because it will keep costs down.

4 strategies build right environment

So what can you do to foster an environment where everyone feels not only comfortable but compelled to raise a hand when something’s amiss?

1. Create – and push – a strong anti-retaliation policy. Everyone needs to understand that speaking up is not only expected but required. And as a result there’s no place for retaliation, whether a claim was founded or ultimately proven untrue.
2. Have an independent entity responsible for whistleblower mechanisms. Many people worry that something promised to be anonymous won’t stay that way. The individual or individuals in charge of this reporting tool must be free from other influences.
3. Watch your wording. The AFC recommends a subtle shift that can make a big difference: Change it from a “hotline” to a “helpline.” If you promote it as more of a tool and less of a mechanism to “tattle,” people will be more likely to use it. Offer it up as a resource to ask questions.
4. Get feedback on your process. Not sure if you have factors in your process that could be dissuading others from speaking up? Circle back with employees who have reported issues to ask about their experiences. Would they speak up again? Why or why not?

Info: To download the report “Encouraging the Reporting of Misconduct,” go to antifraudcollaboration.org

Finance chiefs need to think strategically about how they can get Accounts Payable pros to get rid of checks and set themselves up to take full advantage of the host of new payment technologies out there. To help, guest author Brent Meyers, the vice president of national sales for Nvoicepay, offers a step-by-step plan on how CFOs can make it happen.

This may come as news to accounts payable professionals: You need a payment strategy, and I don’t just mean getting rid of checks. Everybody’s been trying to do that for a long time, with only moderate success. But, that’s not a complete strategy. It’s only a starting point.

You also have to think strategically about what you’re going to replace them with, and about setting yourself up to take advantage of future technology innovations tied to payments. New automated solutions are making it possible to think strategically about how you can get the most leverage from every payment you make.

The hardest part

Step one is to get off paper checks, and move as many suppliers to card payments as possible. As anyone who has tried to move from checks to electronic payments knows, the hardest part is supplier enablement. Many companies have started down the road toward paying more of their suppliers electronically, only to stop after enabling about 10 or 20 percent of their suppliers.

Why? They usually start by trying to move as many suppliers as possible off of checks onto ACH payments. The business case looks great on paper—ACH payments cost just a fraction of check payments, and most suppliers are happy to receive them, since there’s no merchant fee as there is with a card payment. It seems like a no brainer.

Then they get into an enablement campaign and realize how much work it is. You’ve got to contact all your suppliers and collect their banking and routing information. Some people run pre-notes, making a deposit of a penny or two, just to verify the banking information. Then you’re responsible for keeping that banking information up to date, and secure.

And that’s just the beginning of it. With a check, attached to the check is the stub that tells you that supplier what you’re paying them for. With an ACH, sometimes there is CTX (corporate trade exchange) information, but it’s not required, so often times there is nothing. If that’s the case, now you’ve got a project where you’ve got to create some sort of template that is sent to the supplier each time they are paid. Otherwise, a bunch of suppliers are going to call you in two days and say, “Thanks for the money, but what the heck did you pay me for?”

After getting a few hundred suppliers set up this way, people realize, “We can’t roll this out to 900 more suppliers. It’s just too much work.” Big companies will just hire a team to come in and run the campaign, but smaller enterprises usually don’t have that luxury.

So, they’re still making 80 percent of their payments by check. They’re stuck in this twilight zone knowing they could be doing better, but it’s out of reach.

Card first

If you knew how much work it was going to go into it, which a lot of people don’t unless they’ve talked to their peers who’ve done this, it would have been a lot more strategic to start with a card enablement campaign. At least that way you get something in return for that enablement effort—cash rebates.

People don’t start there because they assume that most suppliers won’t want to take a card payment because of the merchant fee. It’s true that many won’t, but some will because they find it more convenient and secure. It’s guaranteed next day funds, and the fee is just a cost of doing business. So, your first pass at enablement should be to find those companies that will readily agree to take payment by card. Once you set them up for ACH, it’s harder to negotiate something else with the supplier.

For example, some suppliers may agree to take a card payment in exchange for faster payment terms. If the supplier is a net borrower, then the speed of money is appealing. If they could get the invoice payment that they’re waiting on from you today, then they don’t have to take that loan at three or four percent and impact their credit. You may be able to find other bargaining chips as well.

By doing your card enablement campaign first, you can probably get rid of 15 percent of your checks. You don’t have to collect and secure banking information, and rebates pay you back for your pain. When you’ve exhausted all the suppliers that will take payment by card, then do your ACH campaign.

Partner with fintechs

Financial technology companies are reinventing every aspect of business finance, starting with payments. Banks have long promised to automate supplier payments for their customers, but have fallen far short. Cloud payment automation companies are building networks of card and ACH enabled suppliers they can leverage across all of their clients, so individual companies no longer have to undertake a manual enablement effort. You can get to a much higher percentage of electronic payments—80 percent or more card and ACH by leveraging a network of pre-enabled suppliers.

With most of your payments automated, you can take your strategy to the next level with new automated trade finance and dynamic discounting solutions coming to market. Even invoice financing is making a comeback. Fintechs are digitizing these kinds of programs, making it possible for every party in the supply chain to track the movement of goods and execute negotiations and transactions in real time. That makes these options far more accessible than they have been in the past.

For example, it used to be common to see companies offer invoice discounts such as 2 net 10, meaning if you pay within 10 days, you get a 2 percent discount. Those kinds of programs weren’t very successful, because not many A/P departments can move that fast in a paper bound world. But, as procure-to-pay and payments become automated in the cloud, companies are starting to have the visibility and the speed in the invoicing and payment processes to leverage discounting strategically.

If you’re still heavy into checks, you’re going to be a long way from being able to capitalize on these new technology solutions, and on even more electronic payment options coming down the pipe. Same day ACH will be fully implemented by March of 2018. Real time payments may soon become a reality. In a few more years, we may have a whole new set of payment rails enabled by blockchain technology.

That’s why it’s time to start thinking strategically about payments. Don’t just think about it as paying bills, or shifting from paper to an electronic payment method. Think about it as an area where you can leverage technology to get increasing value.

Brent Meyers is the Vice President of National Sales for Nvoicepay. His extensive knowledge of the accounts payable industry includes regulation compliance and expense reporting solutions. Brent has held positions in accounts payable, claims, and credit cards, both on the merchant and issuing side. He is an accredited Payables Solutions Consultant through The Accounts Payable Network and a Certified Purchasing Card Professional through the National Association of Purchasing Card Professionals.

The Essentials of Finance 2018 Kit brings together the latest in information, coverage of important developments, and expert commentary to help with your Finance related decisions.

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The Essentials of CFOs 2018 Kit includes the latest in information, coverage of important developments, and expert commentary to help with your CFO related decision.

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The IRS just issued the standard mileage rates for 2018, and the latest figures are a departure from what Finance pros are probably used to seeing from the feds.

After several years of decreasing the rates, the IRS is bumping up the mileage rates for 2018.

This year, the standard mileage rate increased to 54.5 cents for each mile driven for business purposes, an increase of one cent from 2017’s amount.

In addition to the standard rate, the feds bumped the mileage rate for medical or moving purposes by a cent as well. For 2018, the medical or moving mileage rate is 18 cents per mile.

The mileage reimbursement rate for charitable service, however, will remain unchanged at 14 cents per mile in 2018.

Of course, companies can reimburse employees at a higher amount than the standard rates. But if employees are reimbursed for business travel at a higher amount than the IRS rates, then that amount becomes taxable income.

Another reimbursement option

If employers don’t want to use the miles driven reimbursement approach, IRS offers another option: Reimbursing workers for the fixed and variable costs of owning and operating an automobile.

IRS sets a maximum standard automobile cost to calculate these payments.

So, for 2018, the cost can’t exceed:

• $27,300 for cars (down $600 from 2017), and
• $31,000 for trucks and vans (down from $300 in 2017).

This story was originally published on our sister website, HR Morning.

With another year in the books, we’re looking back at the most popular Finance stories of 2017.

And the winner is …

From one to 10, here are the stories CFO Daily News readers clicked on most last year:

1. 5 qualities every internal auditor needs — does yours have them?
2. 5 tough-to-spot signs that invoice is a fake
3. The how and why of dealing with employees with acidic attitudes
4. 4 types you don’t want on your staff: How to handle ’em
5. Want to keep job-hopping Millennials long term? Offer this financial benefit
6. New revenue recognition standard affect Finance: 4 key implications
7. Better benchmarking: 16 metrics Finance needs now
8. 401(k) plan fees: The wrong choices could put you in court
9. Is the new CFO really a COO in disguise?
10. IRS releases 2018 retirement plan limits amid key tax controversy

If CFOs had any doubts the GOP-controlled National Labor Relations Board (NLRB) would take a more employer-friendly stance on workplace issues, recent rulings should put those fears to rest. 

At the tail end of the year, the NLRB handed down four decisions that show the agency’s looking to chip away at Obama-era union protections and create a more employer-friendly climate for businesses.

Two of those rulings — on the definition of joint employer and neutral workplace rules and handbook policies — should be widely embraced by the Finance community. (Note: The National Law Review offers an excellent breakdown of all four rulings).

Here’s a summary of those two rulings:

1. A return to the old standard

According to the NLRB’s recent joint employer ruling, two entities must “directly and immediately exercise control over the essential employment terms of another entity’s employees” to be considered joint employers. Indirect control, or the contractual right to control another company’s employees even if it isn’t actually used, isn’t enough to establish joint-employer status. In addition, limited and routine control won’t satisfy the joint-employer standard.

This is a return to NLRB’s more lenient precedent on joint employers that had been in place for 30 years before a 2015 NLRB ruling created the “Browning-Ferris” precedent. Under Browning-Ferris, the NLRB essentially expanded the definition of joint employer by stating that employers didn’t have to actually exercise control over another company’s employees to meet the joint employer standard. Instead, employers only had to have a contractual right to exercise control over each others’ workers. In other words, it didn’t matter if the employer actually exercised control as long as the control option was on the table.

Cite: Hy-Band Industrial Contractors, 365 NLRB No. 156 (2017)

2. Business interests now considered

In another positive ruling for employers, the NLRB also created a new standard for evaluating neutral workplace rules and employee handbook policies, a standard that overruled the current “Lutheran Heritage” standard.

Under the new standard, the NLRB will decide whether a “seemingly neutral employer rule or handbook policy” violates the National Labor Relations Act (NLRA) by considering:

• the nature and extent of the potential impact on NLRA rights, and
• legitimate justifications associated with the rule.

Under the previous standard, a neutral workplace rule or handbook policy could still violate the NLRA if employees could “reasonably construe” the rule as preventing them from exercising their Section 7 rights.

For additional employer guidance, the NLRB also announced the three categories that an employer rule or policy can fall under — lawful, unlawful or something that warrants individualized scrutiny.

Why the new standard is a win for employers: The NLRB will now consider an employer’s business interests against potential interference of employee rights instead of focusing solely on employee rights — the process under the Lutheran Heritage Standard.

Cite: The Boeing Company, 365 No. 154 (2017)

Note: This story was initially published on our sister website, HR Morning.

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Now may be a good time to review your company’s expense-report management process.

Why? When you think of that 8%-12% of your company’s total budget that goes to T&E, you think about all those hotel stays, airline flights, etc. But there’s something else that’s sneakily jacking up those costs every day. And no one needs to step outside your company’s four walls for it to happen.

So what is this stealth cash drain? Expense report errors.

One in five reports contains at least one error. The price to catch and correct a single error isn’t cheap:

• $52, along with
• 18 minutes of A/P staffer time.

Those estimates come from the Global Business Travel Association.

And while it may not seem like a big deal for your people to correct an error here and there, it adds up fast.

Take heart: There are strategies you can lean on to send errors on a one-way trip out of your company.

Tap technology

Give the people what they want! Survey after survey of business travelers say they want more technology to smooth their process. That doesn’t have to mean a fully automated T&E system.

In fact, to cut down on errors and ease the traveler’s experience, you don’t have to look any further than their smartphone. A few ideas:

• Create “receipt albums.” Taking photos of receipts is a great way to avoid the “I lost one” hassle. But you can go a step further by asking employees to collect them all in a single photo album – one per trip.
• Tap that calculator. If you’re still doing reports manually, make sure folks add totals on a calculator, like the one right on their phones. Use Excel? That should be on their phones as well.

Have an expense management system? You can still do more with your smartphone to reduce the risk of

App-based rideshare services like Uber and Lyft have now enabled automatic receipt forwarding to most major software packages.

You know all too well in Finance: Every time you have to key in info you increase your chance of errors. So why not strip as much of it as possible out of your process?

Serve supervisors

There’s another way to keep your A/P people from getting slowed down by expense report mistakes: Let ’em get caught before they ever make it to your department!

Put the onus on approving supervisors to catch and correct errors.

Of course you don’t want to leave them hanging out to dry. A little insider info can go a long way in getting them to clean these up.

Whether you make supervisors a checklist of the most common errors to watch for or assemble a packet of screenshots of your expense management system to guide them, the key is to get them to zero in on what’s off so they can bounce it back to their travelers to correct.

And empower your own team to be tough here. Sure they could just handle the issue. But advise them to bounce back any report with an error for the approving supervisor to correct. You can bet they’ll be a lot cleaner (and less costly) from then on.