We’ve seen recent news stories about companies facing significant financial troubles brought on by insufficient transparency in their financial auditing processes. If you’re outsourcing audit and payment services to a third party, here are a few industry best practices and internal controls that your provider should be taking to keep your funds – and your carrier relationships – safe and in good standing.
- Verify every shipment for legitimacy and accuracy. Whether your provider receives carrier invoices electronically or in paper format, they should take the necessary steps to ensure each invoice is authentic and accurate. They should also make certain that duplicate invoices are not paid. Find out what your provider’s process is for fulfilling this mission.
- Provide invoicing with full backup detail. You should be able to clearly see all shipment activity from your specified invoice period – whatever that period may be (Transportation Insight clients receive weekly detailed invoices).
- Accept payments in a secure fashion. Find out how your provider handles your payments and manages its internal operations. Best practices dictate that the staff members that reconcile cash do not perform a payables or receivables function.
- Apply your payments accurately to carrier invoices. Does your provider match your payment against the carrier payables related to your paid invoice? Audit and payment companies should avoid “floating” funds to cover other invoices. They should only apply payments toward the invoices you direct them to pay.
- Release funds in a timely and accurate fashion to your carrier partners. Be sure your provider has processes in place to ensure that carrier invoices are paid in a timely fashion. Do they match specific outstanding carrier payables at the shipment level? Do they only pay invoices in full? Do the staff members responsible for issuing payment have any access to bank accounts or the accounts receivable system?
Backed by a system of rigorous controls in place and certified by an independent auditor as SSAE16 Type II compliant, Transportation Insight’s fully transparent and secure invoice audit and payment service is a key component of our Enterprise Logistics solutions that help companies maintain excellent working relationships with their transportation providers. Since our founding, we have employed and will continue to follow all of the best practices I’ve outlined here for more than 1,300 clients, ensuring that their funds and their business are safe with us.