In a recent article for the Times Herald-Record, Charlene Maurer Finerty, founder of New York-based business plan writing service Plans and Profits, recommended thoroughly auditing all company records in order to streamline business processes, minimize embezzlement risks and reduce the likelihood of billing inaccuracies such as duplicate payments.
When conducting an internal accounts payable audit, it should be ensured that the check number, date paid, and amount paid are recorded on each bill, and that every expenditure is supported by documentation. Similarly, accounts receivable invoices should each be able to be matched to a receipt, and it should be checked that orders are all invoiced on time.
Additionally, regular AP audits can help to quickly identify and address misappropriation of company funds, which may result in reduced losses.
The Billings Gazette recently reported that a routine audit of a Montana Health Federal Credit Union teller's drawer revealed that an employee had been embezzling thousands from the company. The money was being used to pay for living expenses, vacations and overdrafts.