Tina Chi reports for Bloomberg BNA on the findings of Mark Pearson, a principal at Deloitte Financial Advisory Services LLP, who says that data analytic tools are the best way to go for locating potential supply chain problems.
Searching for Truth
Chi begins by listing the ways that Pearson says supply chain fraud can be prevented:
- Conduct regular appropriate supply chain due diligence.
- Establish financial stability of suppliers.
- Review payroll costs and employee numbers to target underpayment, overstaffing or unauthorized overtime.
- Include the “right to audit” in supply chain agreements.
Data analytics provide a proactive approach that regular business intelligence methods often cannot, and it supplements the forensic accounting process. Some businesses forego the use of data analytics under the rationale that the data they generate would not make analytics worthwhile, but Pearson believes this cannot be the case. Useful patterns of some kind can start to appear in any type of data. For a more in-depth discussion, you can read Chi’s article here: http://www.bna.com/companies-encouraged-data-n17179889755/