It’s no wonder that the audit recovery business is thriving.and evolving. Many companies are currently benefiting from the services of a recovery audit firm.

Here are some of the reasons why

• People in companies are always fighting a six-headed hydra, constantly focusing on the dragon head that is currently snapping at them. Therefore, there is little time for improvement, best practices, and the tedium involved in reviewing transactions for recovery.

• People don’t want to get their hands dirty. Employees don’t want to do a lot of the “dirty” work before rising up the ranks of management. However, diamonds are in coal…not in the sky with Lucy. Seemingly, no one wants to carry out the tedious task of reviewing the details which then lead to recoveries. Recovery firms can meet this need while saving employee time in performing the review.

• Many times companies will add employees to their workforce rather than improve processes or technology. This leads to more people working a bad process and hence, more issues processed leading to recoveries.

• Companies are constantly downsizing and outsourcing. This creates additional issues due to a "lack of touch" by the people working the process with those who developed the process. This is coupled with the fact that accounts payable departments are constantly understaffed, overworked, and receive a relatively small portion of the budget for technology improvement purchases.

• Most accounting systems were built to process transactions and not to provide users access to the data for reporting purposes. Data analysis is critical in obtaining recoveries. Further, recovery auditors are skilled in data analysis and the types of reports that are the most fruitful. Therefore, it is best to learn from them by watching them on a few engagements.

• Some company managers believe it is simply cheaper to hire a recovery auditor than it is to acquire better processes, people, and technology. In other words, it is sometimes viewed as better to pay a recovery fee than it is to invest in company improvements. Assuming a 25 to 30% recovery fee on the .1 to .3% of processing failure (which works out to an average cost of .0005 multiplied by the transaction flow), that could be viewed as a cost of doing business.