FRAUD

Whistleblower power

One great tip for detecting occupational fraud is, well, tips. Among the frauds studied by the Association of Certified Fraud Examiners (ACFE) in its most recent Report to the Nations 43% were first identified through tips—more than three times as many as were detected by internal audits or management review.

Implementing a whistleblower hotline can be a cost-effective way for companies to enhance their fraud-detection capabilities, the ACFE wrote, making it a good option for smaller companies with fewer resources. Though 71% of the organizations it studied had hotlines already, only 27% of companies with under 100 employees did.

The high cost of fraud: The fraud professionals in the ACFE study said that organizations lose approximately 5% of their revenue to fraud every year, for a total of about $5 trillion worldwide.

The vast majority of the cases they looked at involved asset misappropriation schemes, such as theft or misuse of resources. Only 5% of cases included financial statement fraud, but these were the costliest.

Click here for more on how whistleblowers can help fight fraud.—CV

PRESENTED BY TRINTECH

An AI for finance

There’s been a lot of talk about the opportunities AI offers, but let’s not forget to talk about actually putting those opportunities into action.

To do that, Trintech lays out the deets in their latest white paper, which uncovers how CFOs can effectively leverage AI and automation. You’ll find insights on:

• how to create a plan to harness AI across your financial close, planning, forecasting, and reporting and analytics
• five key opportunities for CFOs to revolutionize processes using AI
• where AI can deliver reliability and transparency
• what AI and the future of finance look like together

While AI offers easier access to huge amounts of data, human judgment and interpretation still need to play a key role in the strategic usage of this data.

Learn how to strike that balance. Get the white paper.

PAYMENTS

Swipe settlement

Ah, 2005. Star Wars: Episode III—Revenge of the Sith was out in theaters, fashions were…questionable, and a group of merchants sued Visa and Mastercard over swipe fees.

Now, nearly 20 years later, and after much legal wrangling, the credit card giants, along with a group of large banks that issue credit cards, have finally acquiesced to a settlement. The agreement, which still needs to be approved by a federal judge, will lower rates by 0.04 percentage points for three years, and cap them at a rate seven basis points lower than current average until 2030.

Swipe fees, also called interchange fees, are fees merchants pay when customers use credit cards. They typically total around 2% of a transaction, according to the National Retail Federation, though they can reach as high as 4%. Merchants usually pass that cost on to consumers.

Mastercard, Visa, and the banks involved in the settlement earned $72 billion in swipe fees in 2023, the Wall Street Journal reported. The settlement will save merchants and consumers an estimated $30 billion over five years.

For more of the settlement’s impact on cost management, click here.—CV

M&A

Bring on the deals

After a sluggish 2023, the current economy has dealmakers ready to step back into the ring.

Eleven “megadeals” of $10 billion or more (not counting debt) have been announced thus far in 2024, the Wall Street Journal reported. They include Capital One’s $35.3 billion purchase of Discover and Home Depot’s $18.25 billion acquisition of roofing distributor SRS Distribution. (Synopsys also acquired Ansys for $35 billion, in a deal that apparently did not include buying any vowels.)

Othernot-so-mega deals may also be on the horizon, if Grant Thornton’s M&A Pulse Survey is any indication: 81% of the M&A professionals surveyed—including PE investors, I-bankers, and the like—said they expect to see deals increase in the next six months.

There were only 16,391 deals made in 2023, according to Pitchbook, as high interest rates and high inflation put a damper on the market. (In contrast, 2021 saw a record-high of 20,413 deals.) That left private equity firms flush with cash to spend or return to investors, which could trigger more deals, Grant Thornton reported. Interest rates are also expected to drop soon: 68% of M&A professionals foresee rate cuts in the next six months.

Read more on what M&A may look like in 2024.—CV

TOGETHER WITH UPTEMPO

Get those #s in order. CFOs and finance teams know cluttered spreadsheets and disorganized budget plans all too well. That’s why Uptempo hosted a talk with SolarWinds that covers how the brand upgraded their budget-planning process to alleviate spreadsheet headaches. Tune in.

MARKET FORCES

JOBS