If you are one of a growing number of companies who contract with a third-party firm to perform an Accounts Payable Recovery Audit…Congratulations! You are already one of the smartest companies in your industry. You’re being proactive and using all your resources to minimize financial errors. Surprisingly, there are still companies that are NOT taking advantage of the opportunity to conduct an independent review of their Accounts Payable data. Those companies may literally be throwing away dollars in the form of duplicate payments, missed discounts, and overpayments.
So, you have a primary audit firm in place and you are making good use of them to minimize losses. But you may be asking yourself, “Is there something more I can do to maintain that competitive edge?” Well, maybe there is. Have you considered a secondary AP audit? A second independent audit firm reviewing your Accounts Payable data may seem redundant, but there are good reasons that make it a sound business practice.
Why should you consider adding a secondary audit in addition to your primary review?
MORE MONEY TO YOUR BOTTOM LINE
A secondary recovery audit will almost always generate additional claims – possibly even more than the primary firm. That is NOT an indication that your primary firm is not doing their job. Rather, it indicates that the primary and secondary firms are complementary to each other. Their systems and processes may differ and claims that one firm does not identify will often be captured by the other.
AUDIT FIRMS HAVE DIFFERENT AREAS OF EXPERTISE
While one audit firm may be an industry leader in recovering freight charges for example, their process for identifying duplicate payments may be sub-par. Additionally, an audit firm that specializes in retail may not have the knowledge and experience to perform a high quality healthcare audit. Using two separate companies as primary and secondary auditors will enable you to better cover all bases.
A SECONDARY FIRM WILL KEEP YOUR PRIMARY AUDIT FIRM ON THEIR TOES
If you have contracted with the same recovery audit firm for an extended period of time and have not looked at another company, complacency may set in. That’s not to say they are doing a bad job. However, they may not be doing their BEST job because they have no one competing for their business with you. No one is questioning their results, so there is less incentive for them to be innovative or to strive to find new recovery opportunities. Two companies competing for your primary business encourages both firms to be at the top of their game.
YOU HAVE AN AUTOMATIC BACKUP IN PLACE
Business is unpredictable. Two firms with knowledge of your systems, processes, and data is a huge advantage in the event your primary firm is unable to complete the audit, or you decide to make a switch. The secondary firm can quickly step in and ensure a seamless transition.
A SECONDARY FIRM ALLOWS YOU TO EFFECTIVELY EVALUATE A POTENTIAL NEW PARTNER IN YOUR RECOVERY AUDIT SOLUTION
Using a dual recovery audit approach gives you an opportunity to observe a new firm first-hand and to answer important questions regarding their performance. Do they maintain a positive relationship with your vendors? Are they writing questionable claims? Are they as knowledgeable as claimed? Are they disruptive to your staff’s daily operations? Contracting with a secondary recovery audit firm is the best way to address these questions.
If you already have a good relationship with your current recovery audit firm, you may feel that you risk jeopardizing that relationship by bringing in another company to follow their review. However, if your recovery audit firm is competent and has integrity, they will not object to having a secondary audit. In fact, they may welcome the opportunity to prove what a great job they are doing!