Invoice fraud and duplicate invoices are a growing concern for small businesses in the UK. Research from Concur has shown that one in thirty businesses have unintentionally paid fake invoices. 34% of UK businesses have mistakenly paid duplicate invoices.
Duplicate invoices can obviously be disputed, and any duplicate payments can be recovered from suppliers. However, this will only happen if the small business has discovered the mistake.
How can small businesses recognise fake invoices?
Purchase orders to the rescue
Purchase Orders (POs) are a widely used commercial document that constitutes formal requests to purchase goods, services or raw materials from suppliers, vendors or service providers.
Given the financial risk posed by invoice fraud a PO is definitely worth considering for a small business
It is important to ensure purchase orders are correctly recorded and that they include any and all information necessary to inform how and when the order is processed, including specific details about the product or service being provided, the timescale for delivery, the agreed costs, the payment schedule and how the client and supplier will handle delays or disputes.
Insist that invoices reference purchase orders
Every purchase order should have a unique Purchase Order Number, which can be referenced when the supplier issues an invoice to request payment.