I recently read a story about a construction company that was charged in federal court with defrauding their client of more than $32 million and paying their workers less than required by law. It made me wonder how concerned companies and organizations are when they hire a construction company: how often do they look for “proof” of honesty and legal transactions before contract? After all, no one wants to discover fraud and illegal activity in the construction company that they have hired, often after a lengthy bidding process!
Fraudulent practices such as those discussed in the article have led to the contractually mandated mountain of paperwork required each month to support Pay Applications. So, as is often the case, honest people end up with extra work because of the fraud committed by a handful. And it gets even harder to get the job done profitably.
I imagine that having a means of providing a reliable audit trail of all financial transactions–the money in, money out, the payments, the receivables–increases a construction company’s odds of winning a bid and making a profit. Reducing the cost associated with providing the necessary transparency just makes sense.
A complete project management plus accounting system, such as the Spitfire Project Management System, provides the tools and record-keeping needed to show accountability and backup during a project and for years later. For example, as vendor invoices are entered into the system for payment, they are cataloged and stored. Whenever billing backup documentation is needed, the system can be asked to gather and organize the documentation for whatever period necessary in just a few moments instead of hours or days.
Proof of honest, transparent business practices becomes easy instead of a headache, and everybody can focus on the actual work on hand instead of worrying about fraud or spending time proving that it doesn’t exist!Tweet