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Duplicate disbursementsare one of numerous types of overpayment errors that arise within the accounts payable management department. The Institute of Internal Auditors have recognised that duplicate payments make up between 0.5% and 0.1% of yearly vendor bill payments which means one in a 1000 bills could be a duplicate. If your company makes £50 million in yearly invoice payments you are likely paying out £50,000 or more in duplicate payments per year..

How Do They Occur?

ERP or Accounting software should have the controls in place to highlight, track or catch duplicate payments overpayments. Yet, the chance of human error means none of the packages are sophisticated enough to prevent more than about 65% occurrence. The Institute of Management and Administration concludes that “Completely eliminating duplicate payments may be an impossible dream”..

Internal Solution

This problem issue can be resolved by completing out the following process :
1.) Obtain a file of the full payment history
The key data fields which are required are Supplier Reference, Invoice Number, Amount and Invoice Date. Where applicable, Purchase Order number can also be valuable.
-For convenience, and to produce a fewer number of suspected duplicates, it is often useful to divide out suppliers such as landlords where the payments are always constantly the same identical amount.
-The data should include credit items. This will reduce the irritation of finding large duplicate payments which have already been collected or where errors have been immediately reversed at the time of entry.
2.) Query the data using specialist duplicate-finding techniques or system.
-This will need the use of a system that can identify classify the items most likely to be duplicates.
-Query results should of course be listed in descending order of monetary amount and chance of being a duplicate.
3.) track suspected items back to their supporting documents.
4.) Contact overpaid suppliers, and ask for repayment or a credit note.
-This step may require some tact, but suppliers are likely to be co-operative with their existing customers. Problems are probable when contacting former suppliers.

FISCAL Technologies is the only company to focus only on cost detection systems. We empower Accounts Payable managers and have analysed client data from all the key financial systems and in 100% of cases we have discovered accidental duplicate payments that they were unaware of saved each many thousands of pounds. We offer a no expense overpayment health check and reportto all qualifying organisations. Please visit - www.fiscaltechnologies.com

Filed under: Accounting Software, Business Software, General