The organic way in which many businesses evolve means that growing companies do not always have the procedures in place that they need to minimise error and waste. One common area for problems is in the accounts department, where duplicate payments and other mistakes – and even fraud – can chip away at your bottom line, eating away at profit margins. Whereas the accounts may be easy to keep track of for a small company, as your business grows you may find that the systems you put in place are no longer suitable, and that inefficiencies result – often with startlingly serious consequences. An accounts payable audit can show you just how serious; if the error rate is as high as even a few percent, then using recovery audit software could mean the difference between turning a healthy profit and getting into real difficulties – or worse. Either way, it’s a good way of making sure you’re only paying what you should, and that people are paying you properly, too.
Discrepancies and mistakes are a way of life, of course, and it’s all but impossible to eliminate these entirely without help. This becomes more significant when the errors are due not to honest mistake but deliberate fraud, when individuals submit incorrect invoices and expense slips with the intention of making money at your expense; this is plainly unacceptable, from a legal, moral or business point of view. Fortunately, such problems can be vastly reduced or even eliminated by the use of the right kind of software and controls, which check your accounts for likely problems and implement procedures to stop this kind of issue from occurring in the first place. Some experts suggest that most companies are likely to have an error rate of 0.1 percent, with other believing the rate is much higher. Needless to say, the bigger the company, the greater the absolute sum of money this represents.
Recovery audit software will help show you where the problems are, including pinpointing duplicate payments – one common area of overpayment. This is really the only sensible way of ensuring that your accounts are accurate and that your systems are making the most of your company, since simple human error – and dishonesty – and the sheer time cost of wading through all the accounts would otherwise be prohibitive. If you don’t already have such software and systems in place, then an accounts payable audit is likely to highlight just how beneficial this could be.
Please visit http://www.fiscaltechnologies.com/ for further information about this topic.