By Daina Xenitelis, FindRecoveryAuditors.Net Researcher

A growing number of today’s business leaders are adding to their bottom line and “sealing the cracks” in their procure to pay process. How? By enlisting the services of a recovery audit firm. Every year, recovery audits expose millions of dollars lost due to processing errors, duplicate payments, invoice pricing errors, vendor over payments and overlooked volume discounts.

Clients spanning a wide range of business types from construction, manufacturing and wholesale, service, retail and healthcare are reaping the benefits. Many recovery audit firms “specialize” in a particular industry or audit category, while others are experienced in multiple areas of business. Following is an inventory of some of the “types” of recovery audits that are currently available to businesses:

Accounts Payable – Recovery auditors review accounts payable data in order to identify duplicate payments, overpayments, statement errors, the elimination of redundant vendors and missed discounts. The recovery firm then reclaims the monies owed you by your suppliers or vendors, and aids in repairing any issues in your process.

Telecom – The auditors review your company’s telecommunications costs. This includes local, long distance and wireless billing errors, unnecessary services and unused equipment. In addition, an analysis of local calling patterns is conducted, with a later suggestion of a service option that would maximize savings. Many firms will also interact directly with service providers on your behalf in order to negotiate calling plans and equipment upgrades, as well as, collect credits for past billing errors.

Postage – As conventional mail is no longer the only acceptable form of receiving important or financial information, a complete review is performed of business-to-business and business-to-customer communication processes. The cost of leased postage machinery, stationary requirements and staff expenses are documented and the recovery audit firm then presents alternative distribution methods. Your recovery auditors then manage the implementation of the cost effective solutions they have provided.

Utilities – Utility bills have traditionally been dismissed as uncontrollable. Electricity, water, heating/cooling or sewage service costs and taxes are often paid blindly. Recovery audit specialists will provide clients with cost reduction strategies after assessing equipment, consumption patterns, state regulations, billing practices as well as taxed and non-taxed rate structures. Many firms will collaborate directly with the vendors to obtain credits and negotiate discounts.

Lease – Commercial tenants are often responsible for a portion of the costs of operating the buildings they lease.  Because leases are complex, it is not uncommon for landlords to make errors when calculating expense bills.  Unfortunately, most tenants do not have the time or resources to scrutinize these bills for errors. A recovery audit firm specializing in lease auditing is the solution. A lease audit includes analysis and investigation of expense charges, scrutiny of lease wording, cost comparison to market rates, physical review of landlord records, the management of claims, and the recovery of overpayments.

Healthcare - There are two types of recovery audits available for organizations on either side of the healthcare fence. For insurance carriers, recovery audits assist insurers in the identification and recovery of overpaid claims, duplicate payments, coordination of benefits (COB) errors and excess payments based on a client’s contract. For providers, a recovery audit service will save lost dollars by identifying and rectifying processing errors related to the increasingly intricate claim submission process. Sorting through complicated contract terms reduces back-end rework due to errors and credits.

Sales & Use Tax – Sales and use tax guidelines can be very difficult to manage for large and small companies. A recovery audit can provide not only potential refunds, but also the assurance that taxes have not been overpaid. State audits only uncover underpayments, not overpayments.

Construction – Many companies are reaping the benefits of enlisting the expertise of firms specializing in construction recovery audits. Those conducting major projects are susceptible to hefty losses if appropriate controls are not in place while managing engineering, general contractor, sub-contractor, mechanical, electrical, excavating and concrete budgets. A construction auditor acts as the project manager’s right hand, and supports him by verifying the details of project cost, providing analysis of alternatives, and evaluating billings.

Freight – Conducting a recovery audit on a freight or shipping system is a sure way to increase a company’s bottom line. These services shed light on the many areas susceptible to profit leaks including: rate negotiation, logistics, inventory, customer pricing, loss claim filing and collection and minimum order strategies.

Media – Recovery audits performed on Media and Advertising data identify lost revenue by reviewing duplicate payments and credits, vendor rebates, contract pricing variances, media and advertising overcharges, distributor-wholesaler pricing, and the accuracy of vendor and supplier transactions.

Travel and Entertainment – A recovery audit performed on a companies T&E process can identify savings opportunities and implement future controls. The areas typically analyzed are: payment tools (corporate cards, cash advances etc), expense reporting systems, T&E policies, and contracts made with airlines, hotels and car rental companies.

To contact a recovery audit firm that specializes in one of the areas of business discussed here, please see the List of Providers section of FindRecoveryAuditors.Net.