Harrisburg: 415 Market Street, Ste #205 Harrisburg, PA 17101 | Camp Hill: 3461 Market Street, Ste 101 Camp Hill, PA 17011 717-273-8626 info@breoncpa.com

Harrisburg CPAs Offer Purchasing Solutions for Your Procurement Processes

Protect your company from preventable losses

You have to spend money to make money. But if you’re not careful about your spending, your company is wide open for waste, abuse and even fraud. Unfortunately, many companies do not exercise sufficient control over their purchasing functions to make sure that company funds are well spent and deliver the intended returns. Abuses, such as overpaying for goods or services, not receiving what you paid for, and having what you paid for walk out the back door, can easily cripple an otherwise profitable company. Fortunately, Breon & Associates has significant experience helping companies strengthen their controls over the procurement process to protect the bottom line. Our accountants are seasoned business professionals who know how to implement best practices for efficient procurement to eliminate unnecessary losses, so your company can keep its competitive edge.

Controlling expenses in a competitive economy

Your company is in business to make money. Revenue from your goods and services is important, but profit is the bottom line. And no company can be consistently profitable without controlling costs. Every dollar your company saves by eliminating waste, fraud and abuse is a dollar that goes directly to bolster the bottom line. Therefore, if you want your company to make money, you have to look carefully at how you are spending money, specifically, the processes by which decisions to spend money are made, carried out and verified.

Breon & Associates can help you examine and improve every facet of your procurement process, including:

  • Procurement (purchasing) process assessment — Are you employing best practices when it comes to buying, receiving and accounting for your purchases?
  • Competitive bidding administration — Is your bidding process designed to yield the best bargain from prospective vendors?
  • Purchasing card (P-Card) usage — Are you properly tracking your employees’ P-Card usage?
  • Expense reimbursement — Are you complying with IRS regulations and only reimbursing employees for valid, business related expenses that are adequately supported?
  • Third party risk assessments — Are you properly vetting the vendors with whom you are doing business?

Our team can help in two ways. We can train and instruct your employees in the best practices for each of the areas listed above. But, as a neutral third party we can also audit your processes, pinpoint exactly where problems lie, and provide a candid assessment. We bring greater objectivity to this task than in-house employees who are naturally reluctant to be the “bad guy,” and too often give rubber stamp approval to poor practices.

Procurement process review and assessment

We have been able to save client businesses significant money by identifying wasteful practices and actual fraud in their purchasing departments. Our review entails a close examination of your processes and controls, but we also analyze your company data to detect anomalies that indicate something is amiss. Some clues to procurement problems include:

  • Suspicious correlations of vendor addresses to your employees addresses
  • Duplicate invoices
  • Suspiciously sequential invoices

The purchasing process creates opportunity for bad actors who want to enrich themselves at your company’s expense. This is where your company is most vulnerable, so this is where any comprehensive plan to reduce waste, abuse and fraud must begin.

Remember, a robust purchasing expenditure process should include the following documents: a purchase order, an invoice, and a receiving report. These documents are compared to validate that quantities and prices match prior to payment.

Expense reimbursement plan administration

Companies routinely ask employees to outlay expenses for which they will later be reimbursed. Unfortunately, few companies ever train their new managers how to review employee expense reports. A new manager rarely feels empowered to open this can of worms and deny a veteran employee an expense that’s always been approved without question. There’s a natural tendency to trust that leads to rubber stamp approval of whatever expenses the employee claims.

We can help you develop an expense reimbursement plan that works by helping you develop an appropriate and clear policy and a system for implementing the policy. (These are also IRS requirements for reimbursed expenses to be tax deductible.) To enforce your reimbursement policy, you should consider outsourcing the review of expenditures. This takes the burden of your administrators and allows a neutral third party — with no emotional attachment to the employees submitting requests for reimbursement — to decide matters based entirely on policy, rather than office politics.

We cannot emphasize enough how much fraud is committed in this area. Moreover, when employees successfully defraud the company here, it creates an incentive to look for other opportunities. But, when you tackle problems with your expense reimbursement plan, you remove the temptation. Soon, that leaky pipe that’s been draining your profits is fixed. You’ve added cash to your bottom line and have avoided any issues with the IRS by staying in full compliance with all regulations.

P-card administration and monitoring

Many companies, in lieu of a petty cash fund, provide credit cards to employees for business related expenses. This is a convenient system, but a company must have a system in place for preventing abuse, because employees will take unfair advantage of a purchasing card if the company fails to monitor spending. Breon & Associates helps companies develop policies and procedures to control their P-card program. We also perform outsourced monitoring and review of P-card activity. Again, this is an area where a neutral third party is in a better position to enforce policy than an in-house employee who has to see coworkers on a regular basis.

Third party risk assessments

Your company has a reputation to protect as well as its bottom line. You want potential customers to think of your company as reliable. But what happens when you’ve contracted with a vendor who does not perform, and the ripple effect damages your relationship with your customers? To help you avoid such a dilemma, Breon & Associates is happy to perform vendor background checks and capability assessments. If you are putting your company at risk by doing business with a specific vendor, we can alert you, so you can consider more favorable options.

Independent competitive bidding administration

Sweetheart deals often go sour. Rather than let an employee’s conflict of interest lead you into a bad bargain for your company, we can help you develop a process to obtain the highest quality goods and services at the best price possible. A sound competitive bidding process, when consistently applied, can provide benefits for your company time and time again.

Contact Breon & Associates for effective procurement process controls

Protect your company from preventable losses in your procurement processes. Ask Breon & Associates about our services to strengthen and administer your spending processes. With offices in Harrisburg and North Central PA, Breon & Associates provides business, accounting and tax services throughout Pennsylvania. Call us at 1-888-516-8476 or 717-273-8626, or contact one of our offices online to schedule an appointment.

Harrisburg Office:

415 Market Street, Suite #205
Harrisburg, PA 17101

North Central PA Office:

86 Municipal Drive
Avis, PA 17721-8941

Camp Hill Office:

3461 Market Street, Ste 101
Camp Hill, PA 17011