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How PayEm Addresses Risks Posed By P2P

Inadequate Data Governance

Tracking data and keeping it updated in real-time isn’t just crucial for procurement, but rather a broader element in a complex legal framework, namely Sarbanes-Oxley or SOX. If a company’s P2P systems are not adequately updating or archiving data – for the sake of lawsuits or audits – then the company as a whole could violate federal law.

When even a shadow of SOX risk presents itself, responsible companies need to adopt new solutions quickly, or else they need to prepare for the unemployment line. Along with its SOC II compliant designation, PayEm, by its very nature, should ease SOX concerns for its users on the grounds of human error, fraud, and other potential pitfalls outlined previously.

From P2P to R2R

Though PayEm’s connected finance platform can resolve many risks posed by a P2P procurement ecosystem, the fact remains that P2P is inherently a limited and outmoded procurement method. Sure, requisition, approval, and PO creation remain essential, but not at the expense of other elements that have become equally so in recent years.

That’s why PayEm has done away with the P2P moniker, opting instead for R2R or request-to-reconciliation. Taking a much broader view than P2P, R2R includes elements preceding and following the three parts of procure-to-pay, thereby expanding the total to seven. The four new actions included by R2R are as follows:

  • Request, preceding requisition, in which employees request funds
  • Payment Method, following PO creation, in which a vendor card is issued or bank account details entered
  • Transaction, following payment method, in which the planned transaction takes place within budgetary limits
  • Reconciliation, following transaction, in which transaction information is matched with invoice submissions, then synced with the company’s ERP or accounting software

Just as the FinTech industry has evolved in recent years, so too must procurement. With so many risks associated with P2P, the dynamic needs to change, and R2R is here to meet the challenge. For all inquiries, procurement-related or otherwise, PayEm’s experts are available to offer a comprehensive, no-cost demo of the platform.

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