Procurement teams work tirelessly to find the best suppliers, negotiate great prices, and snag solid discounts. It can be a surprise to discover that a key supplier represents a conflict of interest to your business or is outright fraudulent. With AppZen Contract Audit, you’ll stay compliant, avoid PR nightmares, and protect your business from any liability by ensuring that suppliers and contractors are continuously monitored for potential risk.
Using artificial intelligence (AI), our Contract Audit solution uses online sources and public databases to stay ahead of criminal activity, fraud, conflicts of interest, and insurance liabilities. It alerts you of any potential areas of supplier risk so you’ll have plenty of time to renegotiate with your suppliers, get updated paperwork, or even submit a termination notice if needed.
Supplier risk check helps with the following:
Catch criminal activity and avoid conflicts of interest
If one of your suppliers makes headline news for illegally dumping chemicals into the ocean, you probably don’t want to be associated with them. However, it’s tough, if not near impossible, to know when and where your suppliers could be popping up negatively in the news. By searching online, AI can alert you if one of your listed suppliers made the front page recently, giving you the opportunity to rethink your partnership. In addition to monitoring the news, AI will determine if your suppliers are responsible for any criminal activity or included on federal government debarment lists so you can terminate the partnership and stay ahead of any issues.
Mitigate regulatory risk
Stay in line with Foreign Corrupt Practices Act (FCPA) and Sunshine Act regulations. AI cross-checks supplier names appearing on invoices and contracts across multiple online databases to monitor payments to foreign state-owned business, healthcare professionals, or any other politically-exposed entities. Avoid the astronomical fines associated with violating these regulations and the poor optics of unknowingly associating your business with bribery.
Flag suspicious addresses
In March 2019, a scammer impersonated a computer manufacturing company and managed to scam Facebook and Google out of more than $100 million. He forged fake invoices using phishing emails and routed the money to bank accounts he controlled. With AI, you can ensure your business doesn’t fall prey to this type of scheme. AI will flag any suspicious address changes so you can reach out to your suppliers and confirm before you make any payments. If the address is residential instead of a business, AI will notify you so you can investigate in case any fraud is taking place.
Avoid conflicts of interest
When shopping for goods and services, you want the best deals, not inflated invoices that disguise kickbacks to board members or employees. AI compares board member names to make sure they’re not associated with any of your suppliers, which may signal they’re receiving financial benefits for recommending the supplier to the company. Additionally, AI can also flag the misuse of marketing development funds (MDF) — for example, if the funds were intended for an industry trade show, AI can verify the number of attendee badges scanned at a conference booth to ensure that the event happened and that the organizer actually drove attendance to the booth to showcase your products.
Keep insurance coverage up-to-date
Ensure that service providers and consultants are properly insured before they come onsite, protecting your organization from any liability. AI alerts you when insurance documents are about to expire, so you can work with your contractors to renew them before more work takes place onsite.
By taking control of your supplier risk with AI, your company can prevent being in the news for all the wrong reasons. No more worrying about the issues associated with unscrupulous suppliers or regulatory risks. In addition to helping you avoid these headaches, AppZen’s real-time audit of invoices and contracts to help you identify billing mistakes, payment term violations, and decrease spend in your accounts payable process. Learn more.