31 Oct Strangely Strange but Oddly Normal
I have been reading the draft of the new Procurement Directive. I had previously dipped into it but have now read all 360-odd pages in sequence. There is a lot in the draft Directive of value, particularly about sustainability, but I found myself musing on the concept of “Abnormally Low Tenders”. The explanatory notes in the draft are quite clear what the concern is: “(44a) Tenders that appear abnormally low in relation to the works, supplies or services might be based on technically, economically or legally unsound assumptions or practices. Where the tenderer cannot provide a sufficient explanation, the contracting authority should be entitled to reject the tender. Rejection should be mandatory in cases where the contracting authority has established that the abnormally low price or costs proposed results from non-compliance with mandatory Union legislation or national law compatible with it in the fields of social, labour or environmental law or international labour law provisions”.28 Oct Procurement related fraud increases by more than 50%
Posted at 13:00h
in Procurement Best Practices, Procurement Process, Purchase to Pay, Purchase to Pay Process
by Pete Loughlin
It’s astonishing! At a time when we have Sarbanes Oxley and a culture of control, in the climate of transparency and scrutiny and a fetishistic focus on finance – how is it that fraudsters have been able to get away with a more than 50% increase in procurement related theft?
But it’s not that astonishing really. A cursory glance at the procurement practices and purchase to pay processes in any organization will reveal opportunities to defraud and while we should never forget that it is the fraudster that’s to blame, the responsibility is shared with the executives who choose to turn a blind eye and underinvest in proper P2P.
22 Oct Just in time finance – how to deal with the need for short term finance
Posted at 14:10h
in Financial Supply Chain Management, Supply Chain Finance, Working Capital Management
by Pete Loughlin
A couple of weeks ago, I sat down with Tony Duggan, CEO of Crossflow Payments, an organisation looking at alternative ways to bring together suppliers and corporate buyers and strengthen supply chains.
Supply Chain Finance is a bit of a buzzword at the moment. The old guard, the banks who seem to have tunnel vision for the very big trade finance deals, and the factors who exploit to a greater or lesser extent the vulnerabilities of small and medium sized businesses view the new SCF players with a mixture of doubt, suspicion and (although they’d not admit it) – fear. And they’re right to. Some of the new models emerging are innovative and impressive and they promise to take business away from the traditionalists. Crossflow is going to do just that in my view. Inspired by hands on experience in industry, Crossflow Payments has taken the concept of ‘Just In Time’ manufacturing and applied it to the financial supply chain. Tony believes that this can help transform the way financial supply chains operate.