As purchasing systems evolve and offer more process flexibility and expanded payment options, it is imperative that procedures be re-engineered to eliminate weaknesses that allow duplicate payments. The extent of the problem of over payment varies across companies and industries. However, it has been estimated that as much as 1% of all corporate remittances are duplicate or inaccurate payments. In the past, bills were paid with one process; upon receiving an invoice, and after validating it against the authorizing document (purchase orders, contract, etc) remittance is sent via a check. This process with fewer possible payment venues was easier to audit for duplicate payments; but no less prone to duplicate payments than modern systems. With all the new payment and invoice delivery options now available, every company needs to be concerned about:


• Payments being made twice using two different payment types

• Professionals in numerous departments making payments without a formal process intended to avoid duplicate payments

• Unscrupulous employees or vendors taking advantage of the increased "opportunities" to hide a duplicate payment.


Items that should be considered when establishing data entry standards for entering an invoice number are:


  • Are leading zeros entered?
  • Are non alpha-numeric characters entered?
  • What should be entered if there is no invoice number?
  • What format is used to enter dates?
  • What should the invoice number be if there is only an account number?
  • What should be entered if the invoice number is longer than the allotted space within the field?


Many companies are moving to OCR (Optical Character Recognition) software which scans the invoice and pulls off the vendor, invoice number, invoice date and amount. If you are using OCR technology, be sure that your manual data entry standards for entering an invoice are aligned with your OCR technology. For example, if an invoice number is 000482, most OCR solutions will read in all of the digits, i.e. 000482, as the invoice number. If your manual process is not to enter leading zeros then you will entered the invoice as 482; causing a duplicate payment.


Invoices without invoice numbers are another source of duplicate payments. A standard process for creating an invoice number where one does not exist should create the same unique number no matter who uses the strategy. For example; Supplier Number plus invoice date creates will create the same number no matter who processes this invoice.




This has been Part 1 of a multi-part series.  Each Tip of the Week will link to the other parts in this series as they are published.  Be sure to join the Ariba Customer Success Group for more in depth best practice tips.


Click her for Tip of the Week:  Procurement - Minimize Duplicate Payments (Part 2)

Click her for Tip of the Week:  Procurement - Minimize Duplicate Payments (Part 3)