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How Duplicate Payment Audit Is Done?

Making duplicate payment is a serious financial drain that a lot of organizations are dealing with. When paying for the same invoice twice accidentally, then you are obviously losing money, which is the same reason why any business should practice duplicate payment audit. Otherwise, this will eat your margin and at the same time, inhibit the financial progress of your company.

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. Well of course, preventing duplicate payments could be done via duplicate payment audit which could provide big benefits in terms of boosting profits, curbing losses and also helping the company to maintain a better cash flow.

The following steps are going to help you in tightening controls that surround invoice processing so by that, you will be able to permanently eliminate making duplicate payments.

Tip number 1. Review your vendor master files regularly to remove duplicated vendors – your accounts payable system or known as ERP system should be designed to accommodate only 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. The new file as well as code is attached to same vendor with the same or potentially 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Well, the major goal of duplicate payment audit is centered on removing duplicate vendors, eliminating outdated information and sending letter to all vendors requesting them to confirm their contact info.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 – as a matter of fact, in avoiding making duplicate payments, this technique of duplicate payment audit is very important. The main reason for this is that, there are other vendors that request for rush check to which it is often issued with a 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. By the time when the vendor sent the original invoice, there’s a chance for duplicate payment to occur.

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.

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