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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. Because if not, this is going to eat your margin and also, inhibit the financial progress of your company.

Averagely, there are approximately .05 percent of paid invoices made in error and with that in mind, it results to big 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. 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 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The end goal here of duplicate payment audit is on eliminating outdated information, removing duplicate vendors and possibly sending letter to all vendors requesting them to confirm their contact info.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 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. There’s a chance that duplicate payment occurs when the vendor sends the original invoice.

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.