Accounts Payable Audit

Duplicate payments, price variances, and overpaid state taxes. These are just a few of the problems that plague accounts payable (A/P) departments, which in turn costs companies valuable time and money. Some estimates measure the cost of duplicate payments alone at 1% or more of a company's annual spend. That is not difficult to understand when you consider that employees routinely focus efforts on their company's present and upcoming needs. As such, very little time or attention is spent reviewing paid invoices and purchase contracts for closed fiscal years to determine whether monies were overpaid.

CRS utilizes a suite of proprietary software and customize search queries to our clients' industries, accounting systems, and data file formats. This enables us to find over 25 types of overpayment errors, including duplicate payments, payments to incorrect vendors, and missed discounts. It also enables us to identify multiple types of possible fraud.

What really sets CRS apart from the rest of "the pack" is our people. The level of professional A/P audit recovery services is directly related to the individuals providing the service and their supportive resources. And that is precisely why we spend an inordinate amount of time ensuring that we hire and train only the best people. These are people who not only possess the requisite audit skill set, but are also curious, tenacious, and creative. At CRS, our A/P audit personnel have outstanding reputations, solid experience and knowledge, and a collective commitment to deliver the highest level of A/P audit recovery services available.

  • Duplicate Payments
  • State and Local Tax
  • Contract Compliance
  • Vendors Who Violate Benford's Law
  • Abnormal Invoice Activity
  • Abnormal/Fraudulent Vendor Activity
  • Abnormal/Fraudulent Employee Activity

Duplicate Payments

Our in-house duplicate payment detection algorithms search for duplicate invoices using a 3-tiered approach and fuzzy matching. If there is an overpayment reflected in the data, we will find it. And if there is an overpayment that can be identified only by going through the files, our manual audit techniques will find it.

State and Local Tax

Most people dislike taxes and anything related to them. And you cannot blame them — taxes are confusing, are always changing, and vary by state. So who keeps up with all of this? We do. We review a multitude of state tax categories in our audits and routinely identify and recover overpayments related to sales and use tax, franchise tax, property tax, severance tax, and excise tax, just to name a few. Because most companies do not input state tax data into their A/P databases, an electronic A/P audit will not identify tax overpayments. That is why we have designed our A/P audits to include both electronic and manual audits. After all, it is our business to bring maximum value to our clients.

Contract Compliance

Companies spend a great deal of money and time ensuring that they negotiate the best possible terms for their procurement contracts. Discounts, rebates, and price variances are common components of these agreements. Who monitors these contracts to ensure that you enjoy the fruits of your hard-fought negotiations? We will review your procurement contracts to make sure that you are deriving maximum benefits from them.

Vendors Who Violate Benford's Law

Benford's Law is a naturally occurring phenomenon whereby the digit "1" appears most frequently in invoice amounts. We use Benford's Law to detect vendors with unusual patterns of invoice amounts — patterns that violate Benford's Law and point to fraudulent or fabricated amounts.

Abnormal Invoice Activity

  • Vendors who have a large percentage of rounded-amount invoices.
  • Vendors who are consistently paid quickly, typically in less than 10 days.
  • Vendors who have sequentially-numbered invoices, suggesting they do business only with you.
  • Vendors with many invoice amounts that are just below approval amounts.
  • Vendors with rapid increases in invoice volume.
  • Checks cut on a Saturday or a Sunday.
  • Vendors with a higher percentage of cancelled or voided checks.
  • Highly above-average payments per vendor.

Abnormal/Fraudulent Vendor Activity

  • Vendor and employee files are cross-checked by address, Tax ID, phone number, and bank routing number, if available.
  • Vendors with P.O. boxes.
  • Vendors with mail drops as addresses (i.e. The UPS Store).

Abnormal/Fraudulent Employee Activity

  • Vendor and employee file are cross-checked by address, Tax ID, phone number, and bank routing number, if available.
  • Employees with P.O. boxes.
  • Employees with mail drops as addresses (i.e. The UPS Store).

CRS will tailor your audit to your goals and desired audit level. Because over 70% of the monies we identify and recover for our clients can be identified only by using manual audit techniques, the majority of our clients request a comprehensive audit encompassing both electronic and manual means. Some clients are more interested in a faster accounts payable audit using electronic means only. Either is fine with us — after all, it is your audit. Either way, we will identify, validate, collect, and deliver the overpaid monies to you, all in a seamless, integrated manner. At the conclusion of each audit, we will provide a master claim schedule detailing all individual overpayment claims, together with error coding, supporting documentation, and possible causes. We also provide a Best Practices Memorandum with customized recommendations to minimize the recurrence of said errors in the future. At CRS, we maximize your recoveries and leave you with solutions to help you further enhance the value of your company.