The Nation’s Preeminent Expert

Our Logic Works

All audit firms will return erroneously made payments to clients, and many are very effective at doing so. However, Auditrax does not use weekly quotas that dictate when the audit is closed down. Instead, our auditors use over 20 proven audit reports and techniques on our proprietary software to identify any and all erroneously made payments for our clients. This includes a manual audit of every invoice during the audit period that allows for recoveries missed by electronic audits.

What is the audit process?

AUDITRAX_PROCESS

Once data has been received by our team, our staff will begin to examine the electronic records of payments through our proprietary audit software. Our auditors will review the areas listed above, along with 21 others areas, to identify potential errors.  Once errors are identified, we will produce copies of supporting documentation for the client and vendor, and obtain credit memo’s or checks from the vendors for the client.

Auditrax delivers 5-10 times the recoveries of other audit firms, how is that possible? What do you do differently?

The major difference between an Auditrax review and those done by others comes from two major areas: our recovery processes and our staffing model. The industry has gravitated towards a simple statement review for its customers, typically yielding a quick $50,000 recovery for larger clients without expending major effort. While Auditrax uses the statement review as part of its complete review package, those claims historically have lead to only 15% of Auditrax recoveries. The remaining 85% of recoveries come from processes that are unique to Auditrax which review over 20 areas to ensure all over-payments are identified.  In addition to a comprehensive analysis of the electronic data download, Auditrax also performs a “box audit”, or individual e-invoice audit, which yields more information than the electronic analysis alone. Given the fact that competitors only review 15% of possible recoveries, it is easy to see how Auditrax can yield 5-10 times the recoveries.

The staffing model of Auditrax uses trained professional recovery auditors that have experience in identifying a variety of over-payments to vendors through forensic analysis and proper audit techniques. With the “call center” statement audit portion of the company only representing the above mentioned 15% of recoveries, that means a more professional review of procure to pay transactions than any other audit company offers.

We already receive audit services from a large accounting firm, why do we need Auditrax?

The type of audit provided by large accounting firms (BDO, Deloitte, E&Y) is to ensure that financial statements are in order and meet the standards required by various regulations. Auditrax, on the other hand, performs a review of the payments made by client organizations to vendors, spanning several years, to identify and collect overpayments. Most overpayments occurs as a result of billing errors of many types made by vendors.

How long does an audit take?

The size of the client organization is the biggest factor in determining the timeline for an audit. However, the active phase of our audits usually take between 3-8 weeks from the time we receive the data until we complete identification of the recoveries.  The collection phase can trail this active phase by up to 8 more weeks.  When both phases are completed we arrange for the final presentation of the audit report

Our Finance and A/P staff already has a very heavy workload. How much of our time will this take?

Most clients are extremely busy, so we have developed a process that is as non-intrusive as possible.  Once we receive the initial data download (which I.T. should be able to provide in about an hour) we can get started.  Typically, less than one hour per week would be needed of a staff persons time during the active phase of the audit.  No time is needed during the collection phase.

We are so busy with other projects, we may just put this off for another year. What is your advice?

The cost recovery audit will provide you value, regardless of when you undertake it.  However, there are limitations as to how far back in time we can go to collect overpayments.  Errors that happened over 4 years ago can be collectible now, but not a year from now, so you stand to lose those older recoveries if you wait.

We have very strong internal controls in place, and the last recovery auditor found very little. Would this still be worthwhile for us?

Our experience has proven repeatedly that we will find what others missed.  Since our results are so different than our competitors, we are not concerned if the last audit found very little—we relish the opportunity to demonstrate this difference by maximizing your recovery.

Our clients are well respected companies with internal controls and refined A/P practices.  But with our expertise we still recover between .1% to 1% of transactional purchasing volume –this only requires a 0.1% error rate in the ERP system and employee processes.

We will be changing ERP systems in the coming year, should we wait to do this until that project is complete?

There are a couple reasons to do the audit now; Our process will fully document where errors are occurring in the old system, providing you with items to be considered in the new, and from a practical standpoint, access to the historical information we need may be easier to obtain before the migration is complete.

It would also be of value to have a follow up audit done after the new ERP system has been in operation, as this type of system change can inadvertently introduce error.

Who receives the results of an audit within our company?

Typically the audit report is presented to the CFO or Controller of a company, but the client is welcome to invite any personnel they feel may benefit from hearing the results. Auditrax will work with the client to ensure that this valuable information is passed on to all those requested in order to reduce future errors.

Does Auditrax extrapolate savings into the future and bill for those savings?

Auditrax does not engage in billing for any future savings or extrapolation of claims. Our audit report details specific areas where errors were occurring, so that measures can be taken to avoid those errors in the future.

We simply bill when capital is actually received by the client in the form of:
1. A check from the vendor
2. A credit memo from the vendor
3. An offset towards an open invoice or free product from the vendor.

What is the cost of your audit?

Our audits are performed on a contingency basis with no upfront or hourly fees. We are simply compensated a percentage of the claim amount we return to your company. This rate is based on client size, industry, location, and other variables. If our encompassing audit fails to find any errors, we congratulate you on your job well done and move on.

Does this service help with SOX 404 validation?

We offer both fraud detection and prevention services. At Auditrax we pride ourselves on the work we have performed in multiple fraud and criminal investigation cases over the years. In addition to specific case work, Auditrax will perform a SOX404 review of your internal financial controls.

Sox 404 – The legislation set new or enhanced standards for all U.S. public company boards, management and public accounting firms. It does not apply to privately held companies. The act contains 11 titles, or sections, ranging from additional corporate board responsibilities to criminal penalties, and requires the Securities and Exchange Commission (SEC) to implement rulings on requirements to comply with the new law. It created a new, quasi-public agency, the Public Company Accounting Oversight Board, or PCAOB, charged with overseeing, regulating, inspecting and disciplining accounting firms in their roles as auditors of public companies. The act also covers issues such as auditor independence, corporate governance, internal control assessment, and enhanced financial disclosure.

Seamless Integration

Use our audit team to research and recover funds with minimal interruption to your day to day business.

Detailed Recovery

We aim to identify any and all erroneously made payments for our clients with over 20 proven audit reports and techniques.

Robust Communication

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