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Best Practices
Error Prevention in Accounts Payable
Karl Andersson
CEO and Founder
direct: 508.281.4697
main: 508.480.8990 (x115)
mobile: 617.233.3525
email: [email protected]
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Agenda
Technology Insight 5 min
• Background
Best Practices 40 min
Questions & Answers 5 min
About Technology Insight
Founded in 1999.
‘Do-It-Yourself’ with DataShark A/P
• secure, web-based P2P operational analysis solution developed
specifically to empower A/P to drive:
– Business process
– Special projects
– Duplicate payment identification & recovery
– Risk management
Recovery Audit Services
• Standalone OR
• Complementary to DataShark A/P
• Based on each customer’s resource & needs
Best Practices
Error Prevention in Accounts Payable
Approach
Issues
Best Practices
Reporting
Leading Issues
1. Inconsistencies in invoice data entry
a) Invoice #
b) Invoice date
c) Fx issues
2. Unclean Vendor Master File
a) Duplicate vendors
b) Mergers/Acquisitions
c) Vendor Partners e.g. distributors
Lost profits occur for a variety of reasons. Today’s changing business
environment has introduced new causes.
Leading Issues
3. Blanket POs
4. Use of temporary personnel
a) High turnover
b) Unfamiliar with your standards and tendency to apply
standards from previous companies worked for
5. New system implementation or consolidation
a) Invoice history not always moved to new system
(majority)
b) Systematic check not possible
6. Implement imaging
a) Manual entry is still often used
b) Mistaken characters
Leading Issues
7. Bypassing ERP controls a) Spreadsheet uploads
b) 3rd party feeds
8. Mergers & Acquisitions a) Confusing times – for both the company & its suppliers
b) Multiple invoices – suppliers not sure who to invoice so send multiples
c) Changing business processes
d) New system implementation or consolidation
9. Transition to Shared Service or Outsourcing model a) Change in business process
b) Change triggers duplicate payments
10. Increased Procurement Card usage a) Pay using Pcard & pay manual invoice
b) Statements mistaken for invoice
Invoice Standards
• Consistent data entry standards
• Central receiving of invoices
Clean Vendor Master
• Consistent naming standards & conventions
• Inactivate old vendors
• Inactivate unused vendors
• Remove duplicate vendor master records
Workflow Review
• Implement duplicate payment checks pre-ERP
Best Practices
ERP Controls
• Implement hard stops (when possible)
• Implement duplicate payment checks for all feeds, i.e. spreadsheet upload, EDI, etc.
Consistent Vendor Business Processes
• Use one type of process per vendor
– Manual invoice; automated invoice - P-card, EDI, etc.; PO/non-PO, etc.
PO Management
• Minimize blanket orders
• Minimize ‘After the Fact’ POs
• Minimize price changes
Vendor Statement Review
• At a minimum - annually
Best Practices
Monthly Self Audit
• Select % of transactions and ensure they meet standards
Drill Down to Root Cause
• Know why errors are occurring
– Categorize your errors
– Provides the ROI for projects to fix the issues
• Correction is prevention. Prevention reduces exposure.
3rd Party Tools Duplicate Payment Identification
• Identify where your ERP duplicate payment controls are failing
Recovery Audit
• Third party review for duplicate payments, overpayments,
payments to wrong vendors, and other open credits
Best Practices
Technology Insight’s
Recovery Audit Services
TIC Recovery Audit Services
Our Focus
• Duplicate payments, overpayments, payments to wrong vendors
• Statement Reviews – other open credits
• Contract Compliance
Differentiators
• Duplicate payment technology
• Intelligent Vendor Targeting
• Automation of the statement request process
• 100% transparency
• Comprehensive reporting
• Option for ongoing audit
Intelligent Vendor Targeting
Perform analysis to identify specific suppliers to
contact for Statement Reconciliation
• Identify vendors with duplicate payment issues
• Identify vendors with inconsistent business processes
– PO and Non-PO spend
• Identify vendors with heavy credit volume
• Identify vendors with significant transaction volume
• Identify vendors with sporadic credit transactions
– I.e. Vendor will consistently have 10 credits and month, but
one month there was only 1 credit.
Clean & analyze vendor master file
• Remove duplicate vendors
• Roll-up suppliers in common
Intelligent Vendor Targeting
Questions
Rebecca Snyder
Director, Business Development
direct: 508.439.6691
main: 508.480.8990 (x103)
mobile: 617.304.8755
email: [email protected]
Rebecca S
Karl Andersson
CEO and Founder
direct: 508.281.4697
main: 508.480.8990 (x115)
mobile: 617.233.3525
email: [email protected]
Contact Details Let’s talk about your specific challenges
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