Accounts payable is the outstanding sums of money owed to and by your organisation. In the course of doing business you will provide products and services to various parties, who will pay you for them. However, payment is not straight away; usually an accepted period of time will pass before the invoices are fulfilled. This may be 30 days, though in some instances it can be two months or more. In other cases just a fortnight is considered acceptable. An accounts payable audit explores what money is due to your company. recovery audit software can be used to investigate the different invoices that are outstanding and find out whether they should be paid (by you), or should already have been paid by clients. One of the most relevant types of overpayment for businesses is duplicate payments, which can arise either accidentally or intentionally through fraud (a company that receives a large number of invoices may not know if a duplicate comes in, and will pay it without checking). Whichever one, you will want to avoid these and other forms of unnecessary overpayment, whilst ensuring that those who owe you money pay it when they should.
Most companies underestimate the financial impact that accounting mistakes cause. If your accounts are in order, you will be paying suppliers on time. However, others may not be treating you with similar courtesy. There will be parties who pay late – perhaps consistently late, or perhaps some have never paid you for certain jobs. Then there are suppliers who have incorrectly invoiced you, or instances where reasonable error has resulted in inaccuracies on an invoice or a copy; invoices typically have many fields of data on them, so this can be a common occurrence.
Studies suggest that perhaps one in a thousand transactions is an overpayment, with duplicate payments being one of the most frequent errors. If your business entails a large volume of transactions, you could be losing substantial sums of money in this way. An accounts payable audit will find out exactly how much account errors are costing you every year. recovery audit software will enable you to get this back, but this is something you should pursue quickly: the more time passes, the lower the chance of reclaiming the money. Additionally, where the errors are a result of fraud, you may need to take legal action – and, at the very least, put in place measures that stop it occurring again.
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