{"id":9788,"date":"2021-09-23T10:15:30","date_gmt":"2021-09-23T17:15:30","guid":{"rendered":"https:\/\/www.qad.com\/blog\/?p=9788"},"modified":"2025-04-16T11:49:29","modified_gmt":"2025-04-16T18:49:29","slug":"global-trade-management-the-problem-with-manual-screening","status":"publish","type":"post","link":"https:\/\/www.qad.com\/blog\/2021\/09\/global-trade-management-the-problem-with-manual-screening","title":{"rendered":"Global Trade Management: The Problem with Manual Screening"},"content":{"rendered":"<p>[vc_row][vc_column][vc_single_image image=&#8221;9790&#8243; img_size=&#8221;full&#8221;][vc_column_text]<span style=\"font-weight: 400;\">In his <\/span><a target=\"_blank\" href=\"https:\/\/www.embeddedcomputing.com\/technology\/security\/why-trade-compliance-screening-matters\" rel=\"noopener\"><span style=\"font-weight: 400;\">recent article<\/span><\/a><span style=\"font-weight: 400;\"> in <\/span><i><span style=\"font-weight: 400;\">Embedded Computer Design<\/span><\/i><span style=\"font-weight: 400;\"> magazine, QAD\u2019s Ian Berman explains why modern trade management is critical to 21<\/span><span style=\"font-weight: 400;\">st<\/span><span style=\"font-weight: 400;\"> century commerce and describes the pitfalls of manual screening. Entitled \u201c<\/span><span style=\"font-weight: 400;\">Why Trade Compliance Screening Matters,\u201d the article lays out the reasons why global enterprises need global automation solutions.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">More Than a Cost of Doing Business<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Perhaps the more compelling reason to comply with governmental regulations regarding exports is the cost. Sanction violations in 2019 resulted in nearly $1.3 billion in fines issued by the U.S. Treasury Department\u2019s Office of Foreign Assets Control alone. Over the years, the U.S. government has increased fines for unintentional missteps violating export controls, sometimes as high as $300,000 or twice the value of a transaction \u2013 but will reduce penalties if companies admit to the missteps. Willful violations have steeper monetary penalties and custodial sentences, which also damage customer trust and revenue.<\/span><\/p>\n<p><b>The bottom line is:<\/b> <span style=\"font-weight: 400;\">all orders should undergo a corporate screening process and the due diligence process should be automated.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Customs\/Document Screening Failures<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The incidence of screening failure during<\/span><a target=\"_blank\" href=\"https:\/\/www.qad.com\/solutions\/global-trade\" rel=\"noopener\"> <span style=\"font-weight: 400;\">global trade management<\/span><\/a><span style=\"font-weight: 400;\"> \u2013 customs activities and documents which move goods across borders \u2013 and their attendant potential for monetary penalties most frequently arise from decentralized and outmoded processes. Manual screening tops the list of screening failures \u2013 it\u2019s expensive and time-consuming. Other screening failures relate to:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Poorly defined authorization and control assignments<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Potential false positives which require time and resources to research<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Incomplete restricted lists<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Inconsistent enterprise-wide approaches to compliance screening regarding processes, risk assessment, decision-making and role expertise<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Ever changing list of restricted or embargoed groups, entities and countries<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">To this last point, Ian writes that \u201cThe US and European Union sanctions regulations are not limited only to those directly named in sanctions programs. These regulations extend to entities that are majority-owned by a sanctioned party in the EU, and 50% or more owned parties sanctioned by the US. In the US, this is known as the <\/span><a target=\"_blank\" href=\"https:\/\/www.treasury.gov\/resource-center\/faqs\/Sanctions\/Pages\/faq_general.aspx#50_percent\" rel=\"noopener\"><span style=\"font-weight: 400;\">OFAC 50% rule<\/span><\/a><span style=\"font-weight: 400;\">\u201d.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Global Trade Management<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">As we describe in another <\/span><a target=\"_blank\" href=\"https:\/\/www.qad.com\/blog\/2019\/05\/global-trade-management-and-best-practices\" rel=\"noopener\"><span style=\"font-weight: 400;\">recent blog<\/span><\/a><span style=\"font-weight: 400;\">, global trade management <\/span><span style=\"font-weight: 400;\">is the practice of streamlining the entire lifecycle of global trade \u2014 across order, logistics and settlement activities \u2014 to significantly improve operating efficiencies and cash flow. This includes everything from production planning and order management to order settlement within your supply chain.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Smart global trade management also includes identifying weak links, turning regulatory trade compliance into a competitive advantage, utilizing trade optimization strategies and best practices, and leveraging free trade agreements. Implementing automated global trade management strategies can result in increased efficiencies, better operational visibility, reduced cycle times and improved profit margins. Enterprises are also better able to respond to geopolitical shifts and supply chain disruptions while mitigating risks.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">The Solution: Automated Best-in-Class Screening<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The benefits of automated screening processes in global trade management solutions are many. Failed screenings are reviewed by authorized subject matter experts to ensure corrective action and create an audit trail. Only compliance personnel review screening exceptions, freeing up staff resources for other value-add tasks. Audit reports are directly tied to shipping transactions and their related customs documentation.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The benefits far outweigh the costs.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">QAD Precision Solutions <\/span><span style=\"font-weight: 400;\">Ensure Ongoing Compliance<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">QAD Precision<\/span><span style=\"font-weight: 400;\"> offers an <\/span><a target=\"_blank\" href=\"https:\/\/www.precisionsoftware.com\/solutions\" rel=\"noopener\"><span style=\"font-weight: 400;\">automated global trade and transportation execution solution<\/span><\/a><span style=\"font-weight: 400;\">. Among the many ways the solution streamlines compliance, <\/span><span style=\"font-weight: 400;\">QAD Precision automatically verifies that a trading partner has passed denied party list (DPL) screening, determines the End Use of the item, validates that the country of destination has been approved and ensures that any special documentation \u2014 including import and export licenses and permits \u2014 or actions are included to support reporting to authorities. It automates the required due diligence and promotes preparedness across operations.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">QAD Precision has created a<\/span><a target=\"_blank\" href=\"https:\/\/www.precisionsoftware.com\/benchmark-your-operations\" rel=\"noopener\"> <span style=\"font-weight: 400;\">global trade benchmarking tool<\/span><\/a><span style=\"font-weight: 400;\"> that measures global trade and transportation operations against best-in-class processes. It delivers insights into operational efficiencies and a detailed analysis of compliance risks and logistics.<\/span><\/p>\n<p><b>Read more about the benefits of automating the global trade process in the <\/b><a target=\"_blank\" href=\"https:\/\/www.embeddedcomputing.com\/technology\/security\/why-trade-compliance-screening-matters\" rel=\"noopener\"><b>full article<\/b><\/a><b> in <\/b><b><i>Embedded Computer Design<\/i><\/b><b> magazine.<\/b>[\/vc_column_text][\/vc_column][\/vc_row]<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[vc_row][vc_column][vc_single_image image=&#8221;9790&#8243; img_size=&#8221;full&#8221;][vc_column_text]In his recent article in Embedded Computer Design magazine, QAD\u2019s Ian Berman explains why modern trade management is critical to 21st century commerce and describes the pitfalls of manual screening. Entitled \u201cWhy Trade Compliance Screening Matters,\u201d the article lays out the reasons why global enterprises need global automation solutions. More Than a Cost [&hellip;]<\/p>\n","protected":false},"author":56,"featured_media":9790,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[182,199],"tags":[1829,1827,516,1828,1831,406,1830,1826],"class_list":["post-9788","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-manufacturing-trends","tag-customs-documentation","tag-exports","tag-global-trade-management","tag-global-trade-solutions","tag-manual-screening","tag-trade-compliance","tag-trade-optimization","tag-trading-partner-screening"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Global Trade Management: The Problem with Manual Screening | QAD Blog<\/title>\n<meta name=\"description\" content=\"Automated trade compliance screening avoids costly manual screening errors with modern trade &amp; 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