2 Ways Duplicate Payment Audit Is Carried Out
Making duplicate payment is a serious financial drain that a lot of organizations are dealing with. When you do pay for the same invoice twice accidentally, then you automatically lose money in that instance which is the reason why businesses need to practice duplicate payment audit. This will otherwise eat your margin and inhibit the financial progress of your company at the same time.
On average, there are around .05 percent of paid invoices made in error and for that, it result to a huge loss on the part of the company. It is vitally important that the accounts payable team be on the lookout constantly and take the stpes to prevent paying the invoice twice. Of course, preventing the duplicate payments can be done through duplicate payment audit which can provide huge benefits in terms of boosting profits, curbing losses and also helping the company to maintain a better cash flow.
In the next lines, you are going to discover a couple of steps that will help you to have tighter security that surround invoice processing so by that, you’ll have the chance to get rid making duplicate payments for good.
Tip number 1. Review your vendor master files regularly to remove duplicated vendors – your accounts payable system or also known as ERP system must be designed to accommodate just one vendor master file record on every supplier. On the other hand, there are other activities that may prompt duplication of the vendor master file.
As a quick example, if there is a different vendor code that’s selected, there is a chance that duplicate vendor master file is made when the vendor invoice has entered into ERP system manually or automatically. This new file and code would be attached to the same vendor that has the same or possibly different bank details.
The aim of duplicate payment audit here is focused on eliminating outdated information, removing duplicate vendors and possibly sending letter to all vendors requesting them to confirm their contact info.
Tip number 2. Control rush check requests – yet another vital process of duplicate payment audit in avoiding making duplicate payments. The reason for this is that, there are some vendors that request for such check which is often issued with check request form before they send in their invoice. It is not bad to give out check but problems arise in the event that there’s no appropriate backup for the said rush check or perhaps the info indicate that the vendor has already been issued a check. When the vendor sends the original invoice, then there is a probability that a duplicate payment occurs.
What the accounts payable team do in their duplicate payment audit is ensuring that there is a solid backup and also, the payment info is immediately entered to the system upon the check is issued.