Ensuring AP audits catch embezzlers

The most common way embezzlers are caught is pure luck, according to a Wiley report. Whistleblowers are another frequent cause, followed by internal accounts payable audits and AP audits conducted by a certified public accountant.

"It is actually unusual for an audit to uncover an embezzlement (because) the perpetrator knows what the auditor does and does not look at, as well as what management does and does not look at," the accounting study guide provider notes.

Sometimes, internal audits simply don't delve deep enough and miss the skillful misappropriation of funds by a bookkeeper or office manager who has experience covering his or her tracks – especially when there's an insufficient or nonexistent system of checks and balances in place.

Wiley points out that accountants are given a lot of responsibility, including overseeing accounts payable and receivable, orchestrating payroll processes and preparing financial statements. Windows of opportunity for embezzlement can prove tempting, especially when perpetrators believe they won't get caught.

Recovery audit software from Technology Insight allows companies to dive deeper into their financials, thoroughly analyzing AP records and increasing the chance that misappropriation will be uncovered. 

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