im_Audit Overview

Audit Overview

An audit is an official inspection of an individual's or organization's accounts, typically by an independent person. InvoicingSM has audit capability enabling servicers and outsourcers to conduct audit on invoices.

The process begins when the vendor submits an invoice to the servicer.

Vendor Submits Invoices to Processor (Servicer or Outsourcer)

As vendors have expenses for services performed, invoices are created and submitted to the servicer for payment. Invoices are created in the system's standardized format and presented electronically through the InvoicingSM system.

Processor Reviews Invoices when Received

Submitted invoices are routed to the Submitted queue. Processors review an invoice and determine if it should be approved for payment or denied. If approved, it is sent for payment. If denied, the invoice is not paid. There are many reasons a processor may deny an invoice. Although the status of the invoices may be denied, it can still be audited if it meets the selected criteria.

DDC1

The DDC1 is a check request file that prepares all approved invoices for payment. Invoices in approved status that do not have an active audit, are pulled throughout the day to the DDC1 file. Once the export runs, the status of the invoice in InvoicingSM changes to Check Requested/ACH Requested.

How Invoices are Selected for Audit

The audit process occurs prior to the DDC1 export. Invoices that meet the set criteria are randomly selected and placed in the Audit queue for the auditor to begin the audit process.

The Audit Process

The auditor reviews the invoices in the Audit queue and passes, fails or removes them. Approved invoices that have a completed audit are sent to DDC1. Completed audits have final responses of Passed, Failed in Error and Removed. Invoices that fail audit, regardless of their invoice status, are sent to the Audit Failure queue for review by the processor. The processor reviews the invoices that failed the audit and either corrects the invoice or makes the determination that they believe the auditor failed the audit in error. The invoice then appears in the auditor's Audit Review queue and they pass the audit, fail the audit again and ask for corrections or indicate that the audit was failed in error.

If the audit process is complete the processor has no additional actions to perform. Approved invoices will be processed in the next DDC1 check request.

If a denied invoice passes audit, the processor has no additional actions to perform. The audit process is completed. However, the status of the invoice remains denied.

If the invoice is returned to the processors Audit Failure queue for additional review, the processor reviews the audit actions and comments from the auditor on the Audit Chronology and performs appropriate action based on the auditors comments. This could result in the system routing the invoice back to the vendor. The process repeats until the audit is completed. The reasons why invoices fail the audit process vary. Some examples may be missing attachments, incorrect decision on the invoice (approve/deny), or missing adjustment. Follow your company guidelines when processing or auditing invoices.

Determining if an Auditor Failed an Invoice in Error

If the processor determines that an invoice should not have failed the audit, they will approve or deny the invoice a second time. The invoice is placed in audit. The auditor agrees with the processor and passes the audit. If the invoices status was approved, it will be processed in the next DDC1 check request.

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