We extracted the invoices payments file for the period of 1st April 2020 to 15th October 2020 from our General Ledger system and ran the predefined Account Payable tests on SmartAnalyzer which we found intuitively easy to use. In fact, I only scanned through the SmartAnalyzer guidance notes that were provided.
The built-in Duplicate Invoice Number test identified 52 records to manually review. These were all followed up and four payments, totalling just over £20,000, were confirmed as being duplicates. None of the payments were Covid related.
As part of our analysis, we discovered that in each case the suppliers had been set up twice on our system, with two different supplier accounts numbers. This resulted in the invoice validation check within the Accounts Payable system failing to detect the duplicate invoice. Upon investigation, we identified the likely cause of these errors.
Previously, in September 2019, the Council implemented Optimal Character Recognition (OCR) software which drastically reduced the number of errors occurring in invoice numbers entry and therefore we did not reasonably expect to find any duplicate payments. It appears the system created new accounts for some existing suppliers which allowed the duplicate invoices to be processed without automatically being detected and prevented.
Having identified the duplicate payments, their values, and to whom the payments had been made, we were able to expediently recall the full sum of duplicate payments and dam the revenue leakage. As of January 2021, the full £20,000+ had been recovered.
Going forward we will be running the IDEA/SmartAnalyzer software on a monthly basis as the software has more than proved its worth after a single first use and payback was immediate.