A Beginners Guide To Tips

The Importance Of Duplicate Payment Audit

Duplicate payment is a significant financial drain that many organizations are facing nowadays. 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. Obviously, duplicate payments may be prevented through duplicate payment audit which may also provide great benefits in terms of boosting profits, curbing losses and also helping the company to maintain a better cash flow.

The steps below are going to help you tighten controls that surround invoice processing which will then allow you to permanently eliminate making duplicate payments.

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, you should know that there are some other activities which can 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The aim of duplicate payment audit here is focused on eliminating outdated information, removing duplicate vendors and possibly sending letter to all vendors requesting them to confirm their contact info.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 – this is yet another integral duplicate payment audit technique done to avoid 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 isn’t bad to give out a check but problems do rise when 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.

Ensuring that there’s a solid backup and that the payment info is entered immediately to the system upon the issuance of check is what the accounts payable team do in their duplicate payment audit.