Recovery audit industry flourishes despite improvements in accounting systems, audit processes, PayStream Advisors says
Charlotte, NC January 20, 2006 U.S.-based businesses overpaid suppliers by $5.25 billion in 2005, up 5 percent from 2004, and the recovery audit services market continues to flourish despite improvements in enterprise systems and processes, according to a new survey of corporate overpayments from consulting firm PayStream Advisors.
In its report, "Recovery Audit Services: It's Your Money," PayStream's analysts highlight the expanding market for recovery audit services (RAS) that help companies recoup duplicate and erroneous supplier payments.
The recovery audit industry, little known outside of the world of corporate financial management, continues to flourish despite recent improvements in accounting systems and audit processes such as those mandated by Sarbanes-Oxley regulations, PayStream reported.
Undetected Errors, Lost Profits
PayStream's analysts estimate that recovery audit industry recovered $3 billion of erroneous payments in 2005, leaving nearly $2.25 billion in errors undetected and uncollected. "U.S. businesses continue to suffer from lost profits due to overpayments because they are unable to identify, recover and repair faulty processes in their business operation," noted Henry Ijams, managing director of the Charlotte, N.C.-based firm.
Enterprise resource planning (ERP) systems such as SAP and Oracle do little to stem the tide, according to the consultancy. Despite a near record $20 billion spent on corporate accounting systems in 2005, corporate overpayments continue to bleed profits from companies in nearly every industry. "Due to the complexity of corporate purchasing activities, nearly all businesses suffer payment errors" said Ijams.
PayStream Advisors' analysts study providers of financial products, services and technology and write reports to help finance managers make purchasing and automation decisions. The Recovery Audit Services (RAS) report is for managers who want to learn about opportunities in recovery audits and are interested in evaluating service providers for their accounts payable and purchasing departments yet need help identifying appropriate vendors and solutions for further investigation.
In addition to an overview of recovery audit services, the report includes profiles of five recovery audit firms Advantium, APEX Analytics, Business Strategy, Inc., Connolly Consulting and PRG-Schultz and provides insights into the industry, these firms and recovery audit trends.
The RAS firms profiled in this report provide a range of audit services, including retail, commercial, healthcare, contract compliance audits, statement audits, sales and use tax audits, escheatment review and real estate lease audits. Many of these providers also sell recovery audit software. PayStream said it sees a promising future for the RAS industry as a whole.
Additional Articles of Interest
Electronic invoice presentment and payment failed to meet its initial predictions. However, recent studies have uncovered a renaissance of interest in Web Invoicing & Electronic Payments solutions as organizations shift their emphasis toward cost containment and productivity enhancement. Read more in "The Analyst Corner: Payment," in the October/November 2005 issue of Supply and Demand Chain Executive.
P-cards continue to advance, and e-payables solutions are making headway, but the convergence of the financial and physical supply chains is still a work in progress. Read more in "Enabling the Financial Supply and Demand Chain," in the April/May 2005 issue of Supply & Demand Chain Executive.
Diversified, growing companies frequently confront the challenge of creating a unified customer experience, particularly around how they bill their clients. Office Depot took on this challenge by taking its accounts receivable processes online. Read more in "When A/R Stands for Competitive Advantage," a Best Practices case study in the June/July 2005 issue of Supply & Demand Chain Executive.
Charlotte, NC January 20, 2006 U.S.-based businesses overpaid suppliers by $5.25 billion in 2005, up 5 percent from 2004, and the recovery audit services market continues to flourish despite improvements in enterprise systems and processes, according to a new survey of corporate overpayments from consulting firm PayStream Advisors.
In its report, "Recovery Audit Services: It's Your Money," PayStream's analysts highlight the expanding market for recovery audit services (RAS) that help companies recoup duplicate and erroneous supplier payments.
The recovery audit industry, little known outside of the world of corporate financial management, continues to flourish despite recent improvements in accounting systems and audit processes such as those mandated by Sarbanes-Oxley regulations, PayStream reported.
Undetected Errors, Lost Profits
PayStream's analysts estimate that recovery audit industry recovered $3 billion of erroneous payments in 2005, leaving nearly $2.25 billion in errors undetected and uncollected. "U.S. businesses continue to suffer from lost profits due to overpayments because they are unable to identify, recover and repair faulty processes in their business operation," noted Henry Ijams, managing director of the Charlotte, N.C.-based firm.
Enterprise resource planning (ERP) systems such as SAP and Oracle do little to stem the tide, according to the consultancy. Despite a near record $20 billion spent on corporate accounting systems in 2005, corporate overpayments continue to bleed profits from companies in nearly every industry. "Due to the complexity of corporate purchasing activities, nearly all businesses suffer payment errors" said Ijams.
PayStream Advisors' analysts study providers of financial products, services and technology and write reports to help finance managers make purchasing and automation decisions. The Recovery Audit Services (RAS) report is for managers who want to learn about opportunities in recovery audits and are interested in evaluating service providers for their accounts payable and purchasing departments yet need help identifying appropriate vendors and solutions for further investigation.
In addition to an overview of recovery audit services, the report includes profiles of five recovery audit firms Advantium, APEX Analytics, Business Strategy, Inc., Connolly Consulting and PRG-Schultz and provides insights into the industry, these firms and recovery audit trends.
The RAS firms profiled in this report provide a range of audit services, including retail, commercial, healthcare, contract compliance audits, statement audits, sales and use tax audits, escheatment review and real estate lease audits. Many of these providers also sell recovery audit software. PayStream said it sees a promising future for the RAS industry as a whole.
Additional Articles of Interest
Electronic invoice presentment and payment failed to meet its initial predictions. However, recent studies have uncovered a renaissance of interest in Web Invoicing & Electronic Payments solutions as organizations shift their emphasis toward cost containment and productivity enhancement. Read more in "The Analyst Corner: Payment," in the October/November 2005 issue of Supply and Demand Chain Executive.
P-cards continue to advance, and e-payables solutions are making headway, but the convergence of the financial and physical supply chains is still a work in progress. Read more in "Enabling the Financial Supply and Demand Chain," in the April/May 2005 issue of Supply & Demand Chain Executive.
Diversified, growing companies frequently confront the challenge of creating a unified customer experience, particularly around how they bill their clients. Office Depot took on this challenge by taking its accounts receivable processes online. Read more in "When A/R Stands for Competitive Advantage," a Best Practices case study in the June/July 2005 issue of Supply & Demand Chain Executive.
- More research from PayStream Advisors.
Companies in this article
