Duplicate payments happen time and time again in companies. We at zapliance have been dealing with this topic for quite some time now and have learned a lot about duplicate payments. In particular, what causes duplicate payments and how they occur. In this blog post, we lay out 10 types of duplicate payments that we’ve seen regularly and that every accounting professional should know about.
In the past we’ve often talked about duplicate payments; especially how to detect them. Our previous blog post “Duplicate payments: I want my money back” was mainly about how to track down this phenomenon. Depending on the way you count, the article only deals with about 15 indications that you shouldn’t ignore when dealing with duplicate payments. However, we now use more than 400 indications to effectively find invoices paid twice with zap Cash. In this article though, we don’t want to go into further indications, but rather ask another W-question and turn our attention from the “How?” to the “Why?” The question addresses the reasons for duplicate payments and what to do once we’ve consolidated 10 reasons into “stylized facts”.
Best of duplicate payment fails
So, let’s get right to it. Here are the 10 ‘double payment fails’ that we’ve actually seen happen:
The procedural breaker
There is an automatic invoice workflow, which should always be used, and which also runs efficiently in principle. However, there are always “exceptional invoices” that are transferred to the accounting department and are manually re-entered.
The currency twister
An invoice is entered twice, e.g. once in local accounting in euros and then again centrally in US dollars.
The double recipient
This one is particularly nasty: an invoice is sent to two different companies in the group. And the invoice is posted in both companies. This often goes unnoticed within the companies.
The logistical confusion
Again, these are different process lines into which an invoice inadvertently arrives at the same time. It arrives once during the invoice receipt processing when material is received and then again directly posted as a cost expense by bypassing current assets.
There is a direct debit authorization with a supplier and the supplier gets the money by themselves. Of course, you can anticipate the supplier and actively transfer the invoice again.
The double orderer
Purchase orders with the supplier belong to purchase orders in SAP. Sometimes it has to be done quickly and it is ordered “manually” again (e.g. by telephone). This of course creates two invoices.
The master data laziness
It is not worth creating a vendor master record for smaller procurements. In this case, the invoice is posted to a collective account (miscellaneous account – CPD). Collective accounts are unclear. It’s possible that a vendor master record could be created, and the invoice could be posted to it.
The master data twins
With many vendors, what often occurs is that two master records (= vendor accounts) are created for one vendor. The invoice is posted to one vendor account straight away and then later looked at in the “duplicate account”, where this invoice is then missing – strange. Then the invoice is accidentally posted to the “duplicate account” again.
The weak alarm
SAP systems will often flash up an “alarm” if an invoice reference already exists when you enter it. But often they are just small warnings and people tend to just close them without reading them. This means the double invoice is then sent to accounting.
There are liabilities that regularly occur again at the same higher level. These include, for example, rents, leases, service contracts or discounts. If you’re thinking “Well, I can just automate that in SAP” – you’re right. But that doesn’t necessarily mean that mistakes will not happen again. On the contrary: a recurring entry happens automatically, and a user may accidentally post the rent again manually because they no longer notice the recurring entry as an automatic process.
We have seen all of the above-mentioned cases happen time and time again and we’ve been able to help our clients quickly by using zap Cash. With the help of zap Cash, it’s possible to find such cases quickly in your SAP data. Throughout our numerous zap Cash projects, we’ve seen these all 10 of these cases occur.
Known phenomena? Vote now!
Take part and tell us which issues you have experienced yourself. We will publish the results at a later date: What are the fails you have already experienced?
- The procedural breaker
- The currency twister
- The double addressee
- The logistical confusion
- The Self-Tricker
- The double orderer
- The master data laziness
- The master data twins
- The weak alarm
- Continuous power
Do you know of any other duplicate payment fails? Leave us a comment below!