Cook the Books and Book the Ledgers - Part 2

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Brian Element's picture
Brian Element
Joined: 07/11/2012 - 19:57
Cook the Books and Book the Ledgers - Part 2

Hello Group Members,

While reviewing Vendor Masters we often come across a situation where a Vendor has multiple Vendor Codes in the Vendor Management System. This may happen through genuine oversight or deliberate wrong-doings from the Vendor Management Team with or without collusion from Accounts.
This situation can be easily detected in IDEA using Duplicate Key Exclusion with Fields to Match being Vendor Name and Field that must be Different being Vendor Code.
The fallout of this situation can pose potential problems and even critical Red Flags when there is an 'Unadjusted Advance' lying against one Vendor Code and 'Bills' being booked and paid through another Vendor Code of the same Vendor without adjusting the 'Advance'.
We have seen actual cases of 'Unadjusted Advances' pending adjustment for months with regular payments being made to the Vendor against their Bills.
By using a simple two step process in IDEA as below ~
(A) Aging of 'Unadjusted Advances' using Aging in IDEA on the Advance Paid Date
(B) Joining the Aging from (A) above with the Sum of Total Payments made to each Vendor month wise.
The monetary impact of the 'Unadjusted Advanced' can be presented against the sum of Total Payments to each Vendor.
With the help of IDEA, a clean - up can be initiated to unify the Vendor Codes to Vendor Names and knock-off the long pending advances against current bills thereby saving significant additional payouts to the Vendor.
In the next discussion post we look at detecting red flags emerging out of inflated capital work in progress project capitalisation.
Best Regards
Group Admin Team