TAG Blog

The Audit Group Blog

Purchase Orders Prevent Duplicate Payments

duplicate sign




  • Purchase Orders are one of the best controls for preventing duplicate payments.
  • A key control feature of a Purchase Order is that it links payments to a specific vendor.
  • Incomplete Purchase Orders provide incomplete communication to AP clerks responsible for paying invoices. 




  • In a recent review of a health system, TAG discovered a total of nine duplicate payments totaling $88,570. None of the duplicate payments recovered during this audit were linked to a PO.  
  • Two duplicate payments were made to Locums Tenens – one payment was made on 10/1/13 for invoice #LTIN 296455, and was paid again as invoice #LTIN296455 (with no space) on 12/31/13. The system’s ERP software did not prevent the duplicate payment because a PO was not linked to help control the transaction.
  • A duplicate payment was made to Koffel Associates when invoice #4043 for $16,500 was paid incorrectly as invoice #443. The following month, it was paid again, using the correct invoice #4043. A Purchase Order was not referenced on either payment.


TAG Tips:


  • POs help organizations reduce the prevalence of duplicate payments.
  • Itemized Purchase Orders are always preferred over Blanket Purchase Orders.
  • PO’s containing:  Item Description, Item Number, Quantity, Unit Price, and other relevant purchasing and payment terms provide the greatest level of security against incorrect vendor payments.
  • Because your ERP system will not prevent a duplicate payment if the same invoice is entered inconsistently, it is imperative for hospitals to link as many invoices to POs as possible in order to control the transaction.   
Continue reading
345 Hits

Vendor Invoice Errors and Problematic Purchase Orders




  • Vendors may issue erroneous invoices which can be overlooked during payment processing.
  • Health systems may not have a procedure in place for documenting/tracking credits issued to correct such errors.
  • Vendor errors go unrecognized when invoice payments are processed using service, capital and blanket purchase orders.   




  • An invoice was issued in error by Standard Textiles Company for “Safety Stock” and paid against a service purchase order. To correct this mistake, the vendor issued a credit to the health system, but the $101,832.00 credit was never entered to be deducted.
  • McKesson issued two invoices twice for the same software and software maintenance charges and were subsequently paid - all against the same capital purchase order. McKesson recognized the duplicate billing of $8,104, cancelling one and leaving the second of the payments unapplied on the account.
  • An invoice was issued by National Hospital Specialties with an incorrect lot number and paid against a blanket purchase order.  A credit and an invoice with the correct lot number were issued; however, only the invoice was paid against the same blanket purchase order which left the $4,757 credit unapplied on the account.


TAG Tips:


  • Encourage use of detailed purchase orders and discourage use of non-detailed “blanket” purchase orders.
  • Capital orders should include specific details and time periods to avoid overbillings.
  • Track use of blanket and service purchase orders to assure trends are appropriate.
  • To assure accountability, consider a program that requires tracking and reconciliation of all blanket or service purchase orders issued
  • Regularly obtain account statements from your key vendors to identify unissued credits.
Continue reading
417 Hits

Aligning Accounts Payable and Supply Chain Processes

Realign people with puzzle pieces


This issue of Insights highlights key concepts from “A Question of Ownership – Aligning Processes Between Accounts Payable and Supply Chain” presented by William P. Stitt, Principal and Chief Operating Officer of Credibility Healthcare, LLC, at the 2016 Association of Healthcare Resources Materials Management (AHRMM) Conference. 




  • Synergies between Purchasing, Accounts Payable and Supply Chain are critical to the success of any healthcare organization, regardless of structure.
  • Relationships between Supply Chain and Accounts Payable may fail due to the constant battle of responsibilities for tasks outside normal procurement and invoice processing, such as:
    • Disputing vendor invoices
    • Matching data between departments (e.g., price, quantity, UOM)
    • Vendor payment inquiries
    • Received Not Invoiced report
  • Sometimes departments do not offer shared access to their data and operate completely independently from one another. Efforts are often duplicated and significant time wasted.




  • One healthcare system managed its purchasing transfers via a shared Excel file that only one user at a time could access.
  • Files were updated by Purchasing and Accounts Payable only once per week.
  • Approximately 64 hours each month were spent on formatting and transferring old comments and data to the new file.
  • Purchasing used invoices to correct Purchase Orders which did not correct original problem.




  • New process was developed using SharePoint that allows multiple users and departments to add, enter and modify data.
  • Ability to build a historical database to track performance.
  • Updated daily. Dynamic tool, new lines added each week, existing lines remain until closed by AP.
  • Email notifications sent when a line is added or modified.
  • No invoices to buyers without approval of Procurement Manager.


TAG Tips:


  • Create opportunities for collaboration between departments by establishing work groups that oversee joint processes.
  • Schedule regular, formal Accounts Payable and Supply Chain meetings.
  • Shared metrics are the key. Both departments need to be invested. Suggested metrics include:
    • Targets for invoices past their due date (days)
    • Cost message reconciliation targets (days)
    • Invoice error rates by line (type of error)
    • EDI invoice Success Rates (first time)
Continue reading
461 Hits

Monitor Expiration of Contracts and Service Agreements

Expired Stamp




  • Service and maintenance agreements and contracts are sometimes paid in advance.
  • Contracts can be modified or canceled before its expiration date.
  • Accounts Payable does not track contract expiration dates for follow up.
  • If Accounts Payable is not informed when a contract is modified or cancelled before its expiration date, credits owed may be overlooked and not issued to vendor.  




  • Seimens Medical Solutions had three Overpayment Claims totaling $37,366 (2-$13,932, 1-$9,502) from canceled service contracts.
  • The healthcare system’s Accounts Payable department was unaware of prepaid contracts being canceled.
  • As a result, Accounts Payable had no knowledge of due credits and, consequently, did not know to either ask for credits or issue debit memos against payments owed.


TAG Tips:


  • Inform Accounts Payable when an agreement has been cancelled or modified – ensure all end-users understand the process.
  • Emphasize to key department personnel who monitor contract usage/services to keep Purchasing and Accounts Payable updated on all modifications, cancelations, or expirations of contracts and service and maintenance agreements.
  • When a multi-period Purchase Order is required:
  • Use a line for each period of expected payment.
  • If each payment period will be for the same amount, then reflect that on the PO as the number of units. For instance, monthly payments should show as “12 units,” and quarterly payments should show as “4 units.”
  • Note each expected payment “unit” as “received” so Accounts Payable can pay product/service charges for that time unit.
  • If costs for an agreement need to be adjusted up or down, cancel the remaining Purchase Order lines for the units of service not yet performed for that year.
  • Add lines to the Purchase Order to reflect amended charges. Keep all Purchase Order adjustments in one place for easy reference and tracking.
  • Use Purchase Order Notes field to create clear explanations of any changes. 
Continue reading
541 Hits

Rebates Present Tracking Challenges

Rebates with Arrow Pointing forward




  • Rebates are a challenge to manage because they require a multi-step process to track dollars earned, credits issued and monies paid.
  • Vendors often factor in rebates as a key part of their pricing strategy and structure.
  • Tracking is the primary problem with a rebate program: some vendors pay rebates via check refunds; others issue credit memos.




  • Based upon their negotiated contract with Cardiovascular Systems, Inc, a healthcare system was eligible to receive a quarterly rebate of $308.64 per item when purchasing 10 or more items.
  • Accounts payable was unaware of some rebates included in contracts and, therefore, had no knowledge of earned credits.
  • The rebates were never issued by the vendor and cumulative unpaid rebates totaled $20,679. 


TAG Tips:


  • Negotiate rebates out of contracts in favor of better pricing terms when possible.
  • Have purchasing or contracting create and maintain a Rebates Master List of all vendors offering discounts in the form of rebate checks or credit memos, and provide access to accounts payable.
  • The Rebates Master List should track the following:
    • Items included in rebate offers
    • Rebate calculations
    • Payment method – refund check or credit memo
    • Frequency of rebate payments (i.e., quarterly, annually, etc.)
    • Rebate received date
  • Have finance manage the receipt of rebate checks and credit memos to verify that the entity is receiving all due rebate funds. 
Continue reading
413 Hits

Non-Original Invoice Copies Lead to Duplicate Payments



  • Duplicate payments is a primary area of concern at most health systems

  • Most duplicate payments occur when at least one payment is processed from a copy or facsimile of the original invoice, which may be fuzzy or hard to read

  • The effectiveness of AP control features is reduced when invoices are not entered into the system correctly and consistently



  • A hospital system paid its vendor, Mail Room Service Center, twice for one invoice

  • One payment for was made from a faxed copy of the invoice on which the invoice number appeared to be “08110280”

  • The invoice was paid a second time from the original copy, using the correct invoice number “08110230”

  • The system’s AP software did not prevent the duplicate payment because invoice data was entered inconsistently

  • TAG identified the duplicate payment and recovered $9,117 in credit for the hospital


TAG Tips:   

  • Educate AP staff on your ERP system criteria for accepting or rejecting a duplicate payment

  • Remind staff to pay extra attention when entering invoice information from facsimile or photocopied documents

  • Flag fuzzy or unclear invoice copies for manual review

  • Investigate discrepancies between invoices and POs thoroughly to determine reasons for price differences before paying invoices; communication with the vendor is crucial to ensure that these discrepancies do not recur

Continue reading
294 Hits

Do Not Create Purchase Orders Based on Vendor-Maintained Data

Detection-and-Analysisjpg Page1



  • Pharmacy departments use vendor-maintained ordering systems to purchase products

  • In this process, all PO-related pricing data and other terms and conditions of purchase are controlled by the vendor, leaving the healthcare system with few controls over pricing and payment

  • Typical business-practice and vendor-client checks and balances are not in effect, and errors generated by this process can be missed



  • When placing an order for a pharmacy product through its vendor McKesson, a healthcare system’s pharmacy or purchasing agent would use the vendor’s operating system, McKesson Connect

  • McKesson Connect created both the PO and invoice, making the transaction totally reliant on McKesson – the vendor – for accurate pricing information

  • Because typical checks and balances were not in place, TAG’s analytical software was able to identify and TAG’s analysts were able to recover more than $99,350 in overcharges to the pharmacy


TAG Tips:   

  • Do not create or use POs based on data provided and maintained by vendors

  • To prevent overcharges, create POs from your system’s ERP system and Item Master File, and send to the vendor for execution

  • Train your system’s pharmacy purchasing agents on the entire ordering process and how to use your system’s vendors’ ordering process

Continue reading
312 Hits

What to Document When Making a Return




  • Returned goods is typically one of the largest areas of claims recovered from a TAG audit

  • Effective returned goods processes are necessary to properly account for all returns credits owed to a hospital

  • Significant funds may be lost to returned goods inefficiencies due to a lack of proper documentation and follow-up with vendors



  • A complex health system had a mechanism within its Lawson ERP system for recording and tracking returned goods

  • Because the system’s staff did not use the Lawson feature consistently to track returned goods, products were not accurately recorded at the time of return and credits for returns went unrealized for three years

  • During a recent audit of the system, TAG found 22 credits for returns to Mentor Corporation

  • As a result of TAG’s follow-through, Mentor Corporation, sent the system a refund check for $33,463


TAG Tips:   

  • Avoid losing credits for returns by implementing the same procedures and documentation for all returned items

  • Information relevant to the return should be recorded in the system and a hard copy should travel with the merchandise back to the vendor

  • Comprehensive returned goods documentation should include the following information:

    • Product being returned

    • Quantity

    • Original Price paid

    • Vendor issued Returned Goods Authorization [RGA] number

    • Amount of credit due for the return or trade-in item

    • Original PO #

    • Reason for return

    • Restocking fee (if applicable)

  • Omitting any of this information increases the probability credits will be overlooked and refunds not obtained

  • All items should be returned through the Shipping/Receiving department to ensure the correct procedures are followed

Continue reading
256 Hits

Overcharges Occur When Contracts Are Not Promptly Loaded



  • Systems may have many individual contracts and pricing agreements both directly with vendors and through group purchasing organizations

  • Making sure a complex health system pays the correct price for every order involves a three-step process:

    1. Determine the correct price and most favorable terms before an order is placed

    2. Create accurate purchase orders that reflect those prices and terms

    3. Resolve differences between POs and invoices

  • If contracts are not loaded into the system, this three-step process breaks down and causes overcharges



  • A complex health system had a local contract with St. Jude Medical Inc. that included special pricing for Cardiac Rhythm Management products

  • However, correct contract product prices were not loaded into the healthcare system’s nor vendor’s systems

  • When the health system was invoiced by the vendor for products, it’s purchase order incorrectly matched the incorrect invoice pricing, thereby paying $24,400 in overcharges to the vendor

  • TAG found the correct pricing terms during a recent audit and presented the payment error to the vendor, recovering the $24,400 in credit for the health system


TAG Tips:    

  • Create a clear procedure for purchasing to load contract terms into the system as soon as contracts are signed

  • Match purchase order prices to loaded contract pricing

  • Update the Contract Master File whenever changes are made to an existing contract

Continue reading
268 Hits

The Danger of Maintaining Multiple Vendor Numbers



  • Duplicate payments may occur as a result of payments to multiple vendor numbers for the same vendor

  • Many AP software systems have control features that should prevent the same invoice from being paid twice

  • A complex healthcare system’s Vendor Master File may contain duplicate entries for one vendor and/or contain vendor numbers that are no longer in use

  • Control of AP software is limited when the same invoice number is paid twice using two different vendor numbers for the same vendor



  • A large health system paid an invoice in November to vendor number 2519289, titled in the system’s AP vendor master file as “AMS Locums—Use 2519289”

  • Two months later, the health system made a second payment for the same invoice to vendor number 2520758, under the vendor name “AMS Locums”

  • Due to the slight variances in the vendor names and the use of multiple vendor numbers, the system’s AP software did not flag the $7,447.59 duplicate payment

  • During a recent review of the system’s AP processes, TAG identified the duplicate payment and reached out AMS Locums to recover the funds; the vendor credited the system with $7,447.59


TAG Tips:    

  • Link invoices to detailed POs ; POs help organization reduce the opportunities for duplicate payments by creating audit trails for transactions

  • Educate staff on AP software criteria for accepting or rejecting duplicate payments

  • Create and review a report of vendor numbers with no activity in the last two years; deactivate unused vendor numbers or merge them as necessary to remove duplications for the same vendor

Continue reading
279 Hits

Tips for Your System’s Contracts Manager



  • Large IDNs have hundreds of individual contracts and pricing agreements – both with vendors and often through a GPO

  • Due to the complexity of the P2P process, difficulty can arise in ensuring accurate prices are paid for all products and services



  • A large health system pays Stryker Orthopedics $930 each for a specific item

  • During a recent audit, however, TAG identified that the system paid more than $2,000 each for this item on several invoices

  • Before recouping the funds to the system, the vendor argued that the item was listed at a higher contract price when used in a specific procedure

  • TAG found no contract supporting a higher price for that type of procedure and reclaimed more than $12,000 for the system


TAG Tips:    

A contracts manager should:

  • Collect, organize and monitor all purchasing contracts

  • Keep all contracts and price lists in a centralized location for easy access to those that need the info – copies may be shared with other departments that need them

  • Track contract expiration dates closely so that expiring agreements can be addressed in advance by those responsible for getting new pricing confirmed

  • Ensure new pricing agreements are loaded into the system by their effective dates to prevent vendor overcharges from being paid by the system

  • Investigate discrepancies between invoices and POs thoroughly to determine the root causes for price differences before paying invoices



Continue reading
241 Hits

Tips for Handling Trade-In Items



  • Items traded in during the purchase of new equipment are often not tracked properly

  • When trade-in items are not properly documented, credit may not be received from the vendor or applied to the purchase of new items

  • To avoid losing credits for trade-in items, use the same procedures and documentation as any other return items



  • A medical center traded in equipment to Steris Corporation during the purchase of new equipment

  • The equipment traded in was originally purchased from a Steris competitor, but the vendor agreed to credit the medical center with $5,000 for the trade-in

  • During a recent audit of the medical center, TAG found that Steris had not deducted the credit for the trade-in

  • After TAG identified the error and negotiated with Steris, the vendor credited the medical center for the traded in equipment


TAG Tips:

  • Items traded in during the purchase of new equipment should be tracked the same as any other return

  • Comprehensive returned goods documentation should include the following information:

    • Trade-in product or product being returned

    • Quantity

    • Price paid

    • RGA number from the vendor

    • Amount of credit due for the return or trade-in item

    • Original PO

    • Reason for return

    • Restocking fee (if applicable)

  • All information relevant to the trade-in item should be recorded digitally in the healthcare facility’s AP software and hard copies should travel with the merchandise back to the vendor

  • Simplify vendor communications by having AP periodically run an open returns report to identify returns and trade-in items for which credits have not been received

Continue reading
317 Hits

Open-Ended Purchase Orders Require Additional Safeguards



  • It takes effective purchasing controls and careful invoice processing to catch invoices issued in error

  • An open-ended PO can prevent ERP systems from identifying overpayment transactions

  • Overpayments may occur if an ERP system is unable to identify and flag duplicate invoices for review because both reference a standing a PO number



  • During a recent audit, TAG found Johnson & Johnson issued a healthcare system multiple invoices in error, which the system paid against a standing PO number

  • When the vendor issued an updated invoice one month, the hospital paid both the original invoice and the replacement invoice

  • Both invoices were paid against the standing PO number

  • An individual set of POs would have reached its limit and triggered the invoice to be sent to purchasing for further review and approval

  • The open PO, combined with Johnson & Johnson issuing multiple invoices for the same product, led to an $18,500 overpayment

  • TAG contacted Johnson & Johnson about the error and the vendor credited the full $18,500 back to the system


TAG Tips:    

  • Discourage the use of blanket POs and encourage detailed POs – even for services

  • Encourage users to track submitted check requests and review their monthly reports for potential duplicate or overpayments



Continue reading
254 Hits

Save Money by Researching Items Not Linked to Contracts




  • Making sure a system pays the correct price for every order involves a three-step process:

  • With a complex network of pricing structures, purchasing and pharmacy departments may have difficulty ensuring all products and services are accurately paid for

  • A system may have hundreds of individual pricing contracts and agreements, both directly with vendors and through a GPO

    • Determine the correct price and most favorable terms before an order is placed

    • Create accurate POs reflecting those prices and terms

    • Resolve differences between POs and invoices


  • During a recent audit, TAG identified monthly overcharges on ICU medical items purchased through Medline

  • After the system’s initial payment, the vendor established a new, higher price for the item without notifying the system

  • The system paid invoices with pricing nearly $50 above contract pricing without researching why they differed from POs

  • The monthly overcharges continued until TAG relinked the item to a contract and contacted the vendor to credit the hospital $13,800


TAG Tips:    

  • Discrepancies between PO and invoice terms should be researched and resolved

  • Scrutinize variance reports that show differences between the PO and invoice prices to determine if items should be linked to contracts (if a contract is still in place, short-pay invoices with overcharges)

  • Changes in product sourcing or contracting should be done with special attention to pricing implications. When a major purchasing shift is made (e.g., changing shipments from manufacturer to a distributor), the follow steps should be taken to prevent overcharges:

    • Contact the manufacturer to ensure a contract in place for direct purchases is also available via the distributor

    • Notify the distributor well in advance of the sourcing switch, ensuring when it happens all appropriate contracts are in place

    • Notify both the manufacturer’s and distributor’s sales reps that the sourcing change is being made so potential issues can be resolved in advance

Continue reading
246 Hits

Your AP Systems Are Only as Smart as Your Staff



  • Accounts payable software systems have control features that should prevent the same invoice from being paid twice

  • The effectiveness of these controls is reduced when invoices are not entered into the system correctly and consistently

  • Most software systems will not prevent duplicate payments if different invoice numbers, company numbers, or vendor numbers are used



  • During a recent review of a health system’s procure to pay process, TAG identified 167 duplicate transactions totaling approx. $435,000

  • Of the identified transactions, the health system’s internal review team had corrected 83% of the potential duplicate payments in dollars

  • However, the system’s AP software (Lawson) was unable to identify nearly $80,000 in additional duplicate payments

  • The root causes of error included:

    • Although purchase orders were issued, AP personnel did not link invoices to POs

    • Incorrect company numbers were used to pay invoices

    • Vendor numbers and invoice numbers were entered inconsistently by data entry staff


TAG Tips:    

  • Implement training programs for AP and data entry staff that emphasize the importance of accuracy and consistency

  • Identify and educate staff on the limitations of AP software

  • Hold front-line staff and their departments accountable for entering vendor and invoice data consistent with department guidelines


Continue reading
321 Hits

Prevent Lost Funds by Monitoring Rebates and Discounts



  • Many promotional discounts are offered by vendor rebates to health systems

  • Rebates are usually based upon the volume purchased during a pre-set time

  • When health systems do not claim rebates regularly, the amount of money lost grows over time


  • A health system entered a contract with Sodexo Inc. & Affiliates

  • Sodexo agreed to issue volume discount rebates if the system purchased more than a certain threshold in a given quarter

  • The rebate applied in two quarters, but the system never deducted the available credits

  • TAG identified the credits and offered recommendations for the system to say current with vendor discounts

TAG Tips:    

  • Keep a master rebate list with current vendors that offer rebate checks or credit memos

  • Implement a formal system for diligently tracking historical contract and pricing terms in a central location

  • Hold materials management and purchasing accountable for to track the following information in the rebate list:

    • Items subject to rebates

    • Rebate calculations

    • Rebate payments (credit or credit memo)

    • Frequency of rebate payments

  • Reconcile rebate records against vendor account statements on a consistent basis



Continue reading
315 Hits

Review Hotel Invoices to Prevent Tax Paid in Error



  • Hospitals may be exempt from sales tax on hotel invoices, but not room tax

  • Hospitals are not always aware of exemptions

  • Tax charges are not always easily visible or itemized on invoices

  • Hotels may inadvertently bill hospitals for sales tax



  • The Residence Inn by Marriott billed sales tax to a not-for-profit health system

  • The system paid the invoices in full, including exempt sales tax

  • TAG worked directly with the hotel to resolve the issue

  • TAG recovered $9,000 in credits for the tax billed in error


TAG Tips:    

  • Ensure AP is aware of tax exemptions and discounts available for hotel stays and hospital functions

  • Creating a purchase order that itemizes negotiated charges for rooms and other services [i.e., banquet functions, conferences, etc] helps ensure AP is able to correctly pay an invoice

  • If you are in a sales tax exempt state, flag and review hotel invoices that itemize tax

  • Do not pay an invoice until it is clear that all discounts and exemptions are included


Continue reading
231 Hits

Tips to Avoid Lease and Maintenance Overpayments

check scam


  • Prepaid lease agreements expire or can be modified/cancelled at any time

  • With no process to alert AP of changes in lease contract terms, funds are lost

  • Properly monitoring maintenance contracts is essential to reduce overpayments



  • A system cancelled prepaid hardware maintenance contracts but did not receive credits due from the vendor

  • TAG identified and recovered seven claims, more than $85,000 from the vendor, Carefusion

  • Recovered funds available for immediate use by the system


TAG Tips:    

  • Keep a master list of service contracts and extended agreements available for supply chain

  • Review service contracts quarterly for compliance

  • Schedule quarterly contract review meetings between Supply Chain and department(s) having largest and/or numerous lease or maintenance agreements

  • Verify that all service contracts being paid are active and that prepaid contracts haven’t been cancelled since last review



Continue reading
303 Hits

A/P Software Systems: Obstacles Leading to Duplicate Payments



  • Accounts payable software systems have control features that prevent invoices from being paid twice

  • The effectiveness of these controls is reduced when the software allows an invoice to be paid under two different vendor numbers – even if they have the same invoice header information



  • During a recent review of a healthcare system, TAG identified 90 claims for duplicate payments and located 29 instances where a vendor had multiple vendor numbers associated with it

  • The healthcare system issued two vendor numbers for Johnson & Johnson under two different names – “Johnson and Johnson Healthcare Systems” and “Johnson and Johnson Health Care System 1.” An invoice for $45,524 was paid twice – once under each of the Johnson & Johnson vendor names entered into the PeopleSoft system

  • In addition, Greenberg Traurig LLP was issued two vendor names of which one was misspelled and entered in PeopleSoft under “Greenberg Taurig LLP.” Consequently, a $14,994 invoice was paid twice – once under each name


TAG Tips:     

  • Management should continue to periodically review the Vendor Master file for unnecessary duplicate vendor numbers

  • Instruct the IT department to create a report of vendor numbers with no activity in the last two years. The report should then be researched and unused vendor numbers made inactive

  • Continue to educate your A/P staff on your ERP system’s criteria for accepting or rejecting a duplicate payment


Continue reading
381 Hits

The Danger of Approving Flagged Invoices Before Review



        • Buyers manually approve invoices that are flagged for review

        • Invoice discrepancies needing review can occur when:

          • contracts expire,

          • items are billed at list price instead of contract price

          • an error occurs in the item number or unit of measure

        • Not reconciling pricing differences before approval to pay leads to overcharges



        • During a recent audit, TAG found overcharges on 10 products purchased from Covidien Vascular Medical Supply over the course of three months

        • These invoices were properly flagged for review due to pricing discrepancies between invoice and PO

        • However, buyers manually approved these incorrect invoices in opposition to established contracts, and AP – per policy – paid them

        • TAG contacted Covidien Vascular Medical Supply and recovered nearly $40,000 in overpayments for the system


TAG Tips:

        • Research all invoices where invoice amounts vary from PO amounts

        • Confirm invoice prices against the Item Master database or vendor contract to ensure proper pricing

        • If a discrepancy occurs, withhold payment until the issue is reviewed and resolved


Continue reading
307 Hits