Weekly Review: Easily Audit Payable Thresholds

 

Check thresholds are an important control point in many companies. Often checks over a certain amount require a particular signature or more than one signature. When the control mechanism slows down the work flow (sometimes by design, we don't want to be in a hurry to write huge checks) users may go around the control. In this case, the control can be circumvented by issuing a number of smaller checks just under the threshold. This can be as innocent as the required signers were not available but everyone knew the check had to go out or it can be blood sucking fraud. It's not unusual for innocent actions to quickly become fraud as well.
An important mechanism to check this control is to review checks cut just below the threshold. This is easy to do in Microsoft Dynamics GP. Simply start with a default Payables Smartlist.

• In the columns, remove current trx amount and add document amount.
• In the search box add:
• Document Type equals Payment
• Document Date greater than Beginning of Week (or Beginning of Month if you want to audit monthly)
• Document Amount is between a lower amount and your threhold amount

For instance, if the threshold for 2 signatures is $10,000 you might set the document amount to be between 9,000 and 10,000. You can fine tune this for your needs but this would show checks cut between 9k and 10k.
Save this smartlist as a favorite and pick the Favorite and Reminder choice. This lets you add a reminder for the system to notify you if there are any transactions that meet this criteria.
Now all you have to do each week is review the list and physically check items near the threshold. Review all checks cut for the week for that vendor and you may find a large one near the threshold and a smaller one that would have put the check over. Once you find that, the hard work of being a manager really begins.

Originally Posted by Mark at 8/25/2008 10:17:00 AM