Back in the good times it was easy to be a little lax about accounting and cash flow. Confidence was good, credit was cheap, business was easy. But then everything changed and even those companies that were strong on paper found it tricky to get a loan, and as the climate changed many found themselves running too close to the wire for comfort. Now, scrupulous accounting isn’t a luxury: it’s a necessity. The problem is that errors still happen; they are almost unavoidable. The good news is that they are not completely unavoidable. An accounts payable audit will tell you where you have lost money in the past – thereby giving you a chance to claim it back. recovery audit software uncovers the vulnerabilities of your systems, allowing you to pre-empt errors in the future that have already cost you money. One of the largest accounting errors that cost businesses money is duplicate payments. These occur when, for one reason or another, you end up paying a supplier or client twice. It can be due to honest error; invoices sometimes have a dozen or so fields of data and it is quite possible to make mistakes and have two sent through unnoticed. However, there are the cases in which unscrupulous individuals exploit holes in your accounting systems and claim with two identical invoices, knowing that you probably won’t notice the duplicate.
Duplicate payments are just one common form of many different accounting errors. These all add up and can drain the resources of a company – especially at a time when there is very little room for manoeuvre. Real trouble can occur if your business is reliant on a large number of small transactions and has a high turnover but relatively modest profit; in those cases, there is far more room for minor errors to aggregate unnoticed, killing your profit margin.
This is why recovery audit software can pay for itself the first instance you use it. For a small or medium-sized company an accounts payable audit can turn up a five-figure discrepancy – and obviously, the larger your company and the longer the problem has been going on for, the bigger the sum of missing money is going to be. Duplicate payments are just one of the types of overpayment, but they are very common and you will obviously want to put a stop to them.
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