Transactional errors result in millions of dollars worth of accounting anomalies for F1000 companies each year. With millions of payments to thousands of vendors, business changes, new systems, and complex purchasing environments, 100 percent payment accuracy is nearly impossible – even for AP organizations with the strongest controls. More and more, AP and Shared Services departments are seeing that to identify the highest percentage of anomalies and recover the most dollars, it is necessary to investigate both their internal AP data and processes, as well as their suppliers’ AR data and processes. Find out more in a free webinar hosted by Lavante and PayStream Advisors - Register now.
Historically, a comprehensive, ongoing review of a company’s suppliers’ AR records, known as a statement audit, was nearly impossible. The biggest challenge with successfully executing a large-scale supplier AR review is managing communication and outreach with mass volumes of suppliers. A “traditional” recovery audit would review the AR records for the company’s top suppliers to identify open credits on supplier records. This process was performed manually and focused only on the largest suppliers resulting in claims that were around 5% of recoveries found by the traditional audit.
In the past ten years, technology and automation have enabled a new way to approach statement auditing. A comprehensive statement audit targets the breadth of a company’s supplier population to request and analyze AR data which delivers significantly higher statement claims (5-10x) than the traditional approaches. This requires an automated solution to manage the supplier data, orchestrate the outreach, and collect and manage incoming information from suppliers. When executed properly, a supplier AR audit taps into an entirely new source of dollars due back to a company.
Additionally, an automated statement audit can be performed on an ongoing basis for a “rolling” timeframe. This provides a “safety net” for a company’s AP department by performing a supplier AR reconciliation on a regular basis, uncovering a continuous stream of credits. An ongoing, comprehensive statement audit is now considered a best practice.
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