Financial miscues and overpayments can cost your company thousands. You may never even feel the money sliding out the door. Consider AP Audit Recovery. A complete and thorough audit of your accounts payable system - invoices due to your vendors - is not meant as an affront to your accounting staff. Accounting is all about "where's the money?" You need to know not only where it is coming from but where it is going. Overcharging or duplicate billing by your vendors is nothing short of throwing money out the window. In most cases, it is simple human error on the part of your vendor, it is not malicious, it is just a mistake. Without an audit of your accounts payable ledger and subsidiary ledgers, you might never know that it is happening.



To be successful, more and more companies are trusting outside consultants to take a look at their books, for internal and external input errors. After all, nothing is better than a second set of eyes looking at the bottom line. You trust your CPAs and tax accountants to find these things, but unless you are paying for a subsidiary ledger audit, these overcharged billings will not be identified. The issue is truly not that errors are being made, but what steps are being put in place to stop them from continuing. In today's economy, this accounts payable problem could be the difference between your company being in the black or in the red.



There are many companies that sell the services of AP Audit Recovery. Many will perform a comprehensive audit that includes accounts payable, property and sales tax, leases, telecommunications and utilities, freight charges and freight reimbursements. Most offer a complete package that will show positive effects for your company for years to come. By giving you a baseline from which to start your continuing analysis of these expenses, it is a much easier task to keep your company on target from invoice to payment.

Accounts payable automation is another response to the problem of overpaying for products and services. By setting standards within your system, anything that falls outside of stated parameters will be readily identified and flagged without the necessity of a person handling this process. The system will flag the issue, which then notifies the person assigned to monitor specific expenditures. By setting thresholds of authority, your company can ensure that more than one person will take a look at paradigm shifts. In this way, no one maintains autonomous control of the company's spending, but everything is available for review.

The first step is to monitor the cost per invoice. Your company's history will be most helpful in determining how deep this audit becomes. For example, if most of your invoices are over $25,000, you would not start the process by auditing all invoices over $10,000. These smaller invoices would be randomly spot-checked against historic data and only brought to review on occasions that the product itself is questionable. For example, $25,000 for an inventory item might not be an issue, but $11,000 for copy paper from an office supply store might be a red flag. The parameters will need to be set before you can control expenditures, finding the overpayments will be a by-product of monitoring the day - by - day purchases.