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A number of clients ranging from £20-500m turnover businesses have used HCG’s financial transaction process experience to review their accounts payable (AP) processes. Concerns included duplicate invoice payments, inconsistencies in VAT reporting, and deviations in supplier pricing agreements. The work is carried on a Gain Share basis so no upfront cost outlay
Instances where suppliers were paid multiple times for the same invoice.
Incorrect VAT rates applied across invoices leading to potential tax liabilities or overpayments.
Discrepancies between invoiced amounts and pre-negotiated supplier price lists.
Our forensic accounting team conducted a structured investigation using the following methodology:
Extracted AP data from the ERP system for the last 6 financial years.
Normalised and cleansed data to ensure consistency.
Categorised invoices based on vendor, date, and product/service type.
Applied data analytics tools to identify duplicate invoice numbers, amounts, and payment dates.
Conducted exception testing to flag identical invoice values with slight variations (e.g., different invoice numbers but same transaction amount and date).
Validated flagged invoices against supporting documents and supplier communications.
Obtain supplier confirmation and agree repayment method ie refund or net off
Cross-verified VAT rates applied against regulatory requirements.
Identified cases where VAT was omitted, misclassified, or calculated incorrectly.
Assessed impact of VAT discrepancies on tax compliance and refund claims.
Matched invoiced unit prices against the contractual price lists.
Highlighted inconsistencies where suppliers charged amounts exceeding agreed rates.
Investigated supplier responses and reviewed contract clauses for potential loopholes.
Agree overpayments with supplier and recover
Average duplicate payment rate in UK Construction is 0.5%-1.0%
Some level of missed profit has been identified on all clients we have engaged with
Identified and recovered in excess of £450k across a number of clients, including over £100K+ from 1
Strengthened VAT compliance, reducing risk of regulatory penalties.
Enhanced contract governance and supplier accountability.
By implementing our recommendations, the client has improved financial integrity and prevented further revenue leakages, ensuring sustainable financial health.
a. Implement automated duplicate invoice detection within the ERP system.
b. Enforce a maker-checker mechanism for AP approvals.
a. Establish automated VAT validation tools.
b. Conduct periodic VAT reconciliation to ensure compliance with tax laws.
a. Set up a structured review of supplier invoices against contractual agreements.
b. Renegotiate terms with suppliers who consistently overcharge.
c. Introduce penalty clauses for price non-compliance.
a. Conduct financial process training for AP teams.
b. Improve supplier onboarding due diligence.
This forensic accounting project demonstrated the value of data analytics in identifying financial discrepancies and reinforcing financial governance. By addressing duplicate payments, VAT anomalies, and pricing variances, the clients achieved substantial profit improvements and improved operational efficiency.
Our firm provides services across a range of Procurement, Supply Chain and Process activities. This includes forensic accounting, risk management, and financial process optimisation, ensuring our clients maintain accuracy, compliance, and financial efficiency. Contact us for tailored solutions to safeguard your organisation’s financial health.
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