Preventing Duplicate Payments In Your Accounts Payable Department
Duplicate payments are becoming one of the main culprits in costing businesses money according to a new report by Fiscal Technologies
. The report, titled Improving Accounts Payable Effectiveness, looks at how duplicate payments are affecting the accounts payable departments in both the public and private sector; and suggests what solutions could help prevent this issue. Although there isnt a sure fire way to eliminate the problem completely, investing in an Invoice Management Solution could lower duplicated payments dramatically.So what are some of the causes that create duplicate payments? According to Fiscal Technologies, there are over 30 different reasons why duplicate payments occur, many are trivial and there is no one reason causing this to happen. Fiscal believes that the main reason duplicate payments are such a problem is because detecting it is generally the responsibility of the AP team. However, in order to fully address this issue, human intervention from both the customer and supplier is required.
One way of combating it is to invest in an invoice management solution. Some, if not all, invoice automation solutions will offer Optical Character Recognition (OCR) as part of the package, giving businesses the ability to automatically read any information on an invoice and input this data into the system. Integrating OCR with your businesses financial application or ERP system will ensure there are no opportunities for duplicate data entry.
Another common mistake that can cause duplicate payments includes typographical errors. This can include:
- Confusing the number 5 with the letter S
- Confusing the number 1 with the lower case L or I
- Mis-keying or simply omitting punctuation
- Adding a letter to the end of an invoice number to get past the system control which is flagging it as a duplicate.
All these errors can lead to higher costs within the AP department and the company as a whole. By investing in an IMS, businesses will reduce the amount of time manually keying information into the finance system, as the solution will be able to scan, read and automatically send the invoice to the appropriate person to authorise. Any manual data entry that is required can be made as quick and easy as possible with the use of scanning and on screen displays. The indexing software contains features such as zoom in and look up, whilst barcode merging removes any duplicate data entry.
According to the Cabinet Office, duplicate payments are the main offender of fraudulent purchasing activity, which cost the public sector 2.3 billion last year. Research shows that 23% of companies pay duplicate invoices, which can add up to a staggering amount of money for businesses to lose every year. By eliminating manual data entry and investing in an Invoice Management Solution or E-Invoicing system, businesses could prevent the above discrepancies, whilst also benefitting from reduced costs and improved efficiency.
If duplicate payments are a concern in your business, then consider the above benefits of implementing an invoice management solution into your AP department, and how it can help your company to save money and reduce errors.
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