Payment process not managed
Risks
- Late payments leading to complaints of not paying suppliers promptly and payment of financial penalties as permitted under legislation
- Payments made for goods or services not received
- Payment made to the wrong supplier
- Payments are not matched to correct purchase order leading to double accounting
- Loss of prompt payment discounts
Solutions
- Ensure staff involved with recording goods received documentation and authorising payments are aware of need to do this promptly
- Ensure staff are aware of the importance of carefully checking deliveries for correctness and taking appropriate action where there are errors on problems
- Ensure staff are aware of the need to identify suppliers accurately when identifying suppliers (on orders and invoices authorisations)
- Where purchase order processing is computerised, or order details are uploading into the financial system and the information is used to prepare commitment accounting information – ensure that staff are aware of the importance of accurately quoting order numbers and matching goods received documentation and invoices back to the correct order number
- Ensure staff involved with recording goods received documentation and authorising payments are aware of need to do this promptly
Inadequate separation of duties
Risks
- Staff open to challenge of inappropriate behaviour
Solutions
- Ensure different staff are involved at the different purchasing phases