We have controls in place regarding expense limits and approval of expenses prior to sending to Accounts Payable, etc. Our accounts payable employee cannot set up new vendors in the system, another accounting employee needs to do that. Our Accounts Payable employee cuts checks or sets up ACH payments, then a different employee in the Accounting area checks the invoices against the checks/ACH set-ups and then they are sent out. What is to say the invoice the 2nd person is looking at isn't fake? Doesn't seem like a very effective control.
The piece we are trying to decide if it is worth doing is the comparison of the check/ACH set up to the invoice by the other Accounting team member before the payment is sent out. We think this may be a leftover control from years ago when the Accounts Payable employee could set up vendors in the system that no one would have known about.
Do others have any controls after the payment is processed by AP or do you just rely on the controls for invoice approval, limits, vendor set up etc? Does anyone have a link between their Vendor Management process and approval of new vendors in AP?
Does anyone have better control processes to prevent/detect fraudulent AP payments? Our VP-Finance is looking for best practices in this area.
Thanks!
