Why A/P should be wary of split invoices

May 3, 2012 by Jared Bilski

Posted in: Fraud prevention, In this week's e-newsletter, Latest news & views, Management issues

Split invoices can be more than an inconvenience for your A/P department, they can be a red flag that something’s not right with a vendor.

That’s why the experts over at The Accounts Payable Channel are urging employers to have A/P take a closer look at any split bills.

When vendors break down larger bills into a number of smaller charges, it makes it easier to sneak in fees that weren’t agreed upon. And smaller invoices probably don’t require the same level of approval as big-ticket items.

Of course, the mast majority of your vendors probably have a perfectly legitimate reason for sending invoices this way.

But it’s just good business to put A/P on the lookout. If they do see a vendor that suddenly starts sending split invoices, have them find out what the business reason is.

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Tags: A/P department, Big-ticket items, Split invoices, The Accounts Payable Channel

Anne

When invoices are split, it is because the boss has asked us to do that. They don’t have to go through the same rigorous approval process, if it’s under a certain amount. That’s the only way our customers can do an upgrade at their business. We don’t tack on any more fees or charges. The main invoice is split in 2 or three smaller invoices, depending on the amount of the original invoice.

We have a bid that was approved and that’s the invoice amount we bill, whether it’s 2, 3, or 5 split invoices. The approved bid amount is the only amount that’s billed.