How Duplicate Payment Audit Is Done?
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. Otherwise, this will eat your margin and at the same time, inhibit the financial progress of your company.
Well on average, there are actually .05 percent of paid invoices made in error and because of that, it leads to huge loss on the part of the company. It is vital that the accounts payable team on lookout constantly and take the preventive steps to keep invoices from being paid 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. There are other activities on the other hand that might prompt duplication of the vendor master file.
For instance, when the vendor invoice has entered into ERP system manually or automatically, duplicate vendor master file will be made if there’s a different vendor code that’s selected. This new file and code would be attached to the same vendor that has the same or possibly different bank details.
Well, the major goal of duplicate payment audit is centered on removing duplicate vendors, eliminating outdated information and sending letter to all vendors requesting them to confirm their contact info.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. This is due to the reason that there are some vendors that are requesting for rush check which is typically issued with check request form before they send in their invoice. Well, there’s nothing wrong in giving out checks but the issue arise when the info indicate that the vendor has already been issued a check or when there’s no appropriate backup for the said rush check. By the time when the vendor sent the original invoice, there’s a chance for duplicate payment to occur.
Well what the accounts payable team do in their duplicate payment audit is to ensure that there’s a solid backup and at the same time, the payment info is entered ASAP to the system once the check is issued.