AuditMyBooks automatically analyzes small and medium business accounting records to detect errors and possible fraud.

Despite mentioning errors before fraud in most of our copy, it seems we often focus on the later.  I suppose it has something to do with CSI airing 3 nights a week.  Everyone loves a good “whodunit”, and the stories behind most fraud cases usually don’t disappoint.

While I doubt we’ll be seeing any shows next season with plotlines based on accounting errors, we shouldn’t treat them as secondary to fraud.  From an economic standpoint accounting errors can be quite interesting, especially when considering the opportunity for financial recovery.

Take duplicate payments as an example.  In most cases they are not fraud related, but can represent a significant financial loss.  Experts estimate that as much as 2% of payments are duplicated.  Assuming you process $1 million in A/P invoices means you could be losing as much as $20,000 per year.  To make matters worse, assume you’re running a company that makes 10 cents on the dollar.  A $20,000 expense  leak requires $200,000 in new sales to offset it.  Accounting errors are suddenly pretty interesting.

Accounting software packages usually have some controls related to duplicate invoices, but there are still ways to make mistakes.  Write a check to a vendor on Monday and process the same transaction as a vendor invoice on Wednesday, and you’re on your way.  There are several “opportunities” to make the mistake.

There are solutions to the A/P leakage problem.  Last week I attended a training session hosted by an enterprise software company called IDEA.  Duplicate payments was one of the examples the instructor used to illustrate the value of the application.  ACL is another application that can be used to identify leakage.  Like IDEA, ACL is geared towards large companies or accounting professionals with specialized training.

AuditMyBooks automatically analyzes small and medium business accounting records for mistakes like duplicate payments.  Working with small business experts who have years of experience as ProAdvisors, Certified Public Accountants, Chief Financial Officers and Certified Fraud Examiners, we’ve identified more than 100 tests to detect errors and fraud.  AuditMyBooks can be configured to meet the needs of all small businesses regardless of company size or industry. Unlike manual reviews of transaction logs which are time consuming, costly and rarely performed, AuditMyBooks automatically analyzes accounting records in a matter of minutes. You can use it daily, weekly, monthly … as often as you choose.

One of our beta users found a duplicate payment a few weeks ago.  Interested in scanning your data… check out our free trial today.

-CP Morey