There are two ways for any company to raise their net profits: increase sales or reduce expenses. At times the expense side of that equation is neglected, if not overlooked entirely. One of those areas is utility costs – more specifically utility, telecom, and waste expenses.
Currently, most companies only look at their utility and telecom charges for reasonableness. Does the invoice fall within our budget? Does it look similar to last month’s bill or some other historical trend? If it falls within those parameters it is assumed that the bill is correct, and it gets paid. However, there is a problem with that. Those bills are often incorrect!
Industry averages show that utility, telecom, and waste invoices are wrong over 80% of the time. Why are these bills wrong so often? There are many reasons for the errors and overcharges. Key punch errors, misread meters, ineffective rate applications, incorrect contract implementation, misapplication of tariffs, billings for disconnected lines, and the list goes on. Accounts can be billed incorrectly from the start because of the wrong setup. Companies also could be billed inefficiently because their business operations have changed, such as an increase/decrease in capacity or a shift in the type of operations. In addition, laws and tariffs are constantly changing so an account that was setup to be billed properly in the past may not be advantageous or correct today.
Due to the complex nature of these billings, both large and small companies are not able to properly verify these invoices prior to paying them. Yet the utility and telecom companies put the burden on their customers to identify errors and overcharges on their bills. But where will companies find the time, resources, or expertise to properly verify these invoices? After all, the charges are based on complex tariffs and codes written by the utility and telecom industries.
When a company realizes the high error rates of these invoices and the fact that they are treating them as fixed costs by paying them with little to no verification, they should consider steps to remedy that situation. An invoice audit is the only way to ensure that a company is not being billed incorrectly. An audit by a team of experts who can navigate the tariffs, codes, and laws applicable to these bills will enable the company to have the assurance that they are being billed accurately and cost efficiently.
Working with a utility bill auditing company is a simple process. Companies provide copies of bills along with letters of agency and the auditors take care of the rest. They serve as agents working on their client’s behalf in full communication along the way to validate and correct erroneous charges with the vendors. More importantly, any fees paid to the auditor are contingent upon their ability to reduce the company’s costs. If the auditors find the company has been billed correctly, the company would pay no fee to the auditors, yet they receive the full benefit of knowing their invoices are correct. If savings opportunities are found and implemented, the auditor’s fee is paid from the recovered funds so companies never pay fees out of their pocket.
Any company who is concerned about errors and overcharges on their utility, telecom, and waste invoices should engage a utility bill auditor to have those bills verified. The company’s bottom line will thank them for it!