What's wrong with these sales invoices?

Posted by Prof. Dr. Nick Gehrke on Nov 10, 2016 5:00:00 AM

Part IV of the series: “Digitization of auditing SAP Order-to-Cash Processes”

Today's blog post explains three interesting indicators in the area of outgoing invoices as part of SAP order-to-cash processes.

 

1. Digitization of auditing SAP order-to-cash processes
2. How to audit master data in order-to-cash processes
3. Auditing of order-to-cash processes: sales orders and deliveries
4. What's wrong with these sales invoices?
5. Who cares? Auditing incoming payments
6. On how to find exotic processes
7. SAP data structure in order-to-cash: Who cares?
8. Way to go: Auditing real SoD in order-to-cash
9. This is the end of digitization!

 

Before you proceed reading on the details of the indicators, I would recommend you read the concept of indicators in part 2 of the series first.

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Three TOP indicators of outgoing invoices

As already mentioned, every indicator is associated with one process, one process area, one audit objective and one risk respectively. In the following, three indicators from the area of outgoing invoices will be introduced.

Altogether I have designed and implemented 40 indicators for the order-to-cash process. You can download the details about all order-to-cash indicators here.

 

Download pdf

 

Revenue without an outgoing invoice

This indicator aims at identifying compliance and correctness.

There is the risk that revenue has been posted without an outgoing invoice.

The document has been marked because it posted a revenue (credit item in P/L) and the account of the revenue has in >90 percent of cases a debit item (KOART='D') in the document belonging to a customer (e.g. an invoice). In this case, the debit item of a customer does not exist.

 

Reversed accounts receivables

This indicator aims at identifying compliance and correctness.

There is the risk that accounts receivables are reversed late and potentially posted again to avoid depreciation.

The document was marked because it contains a debit item related to a customer (accounts receivables KOART='D') and this document was reversed more than 30 days after its posting date. It is also shown when there were accounts receivables items of the same customer which were posted within 14 days after the processing date of the reversal.

 

Intra-community supply or service with VAT

This indicator aims at identifying compliance and correctness.

There is the risk that an intra-community supply of goods has not been treated tax free or for an intra-community supply of services within the EU the reverse charge approach was not applied.

The document has been marked because the referenced customer is corporate (Datafield KNA1-STKZN) and is registered in another third country (Datafield KNA1-LAND1) or the supplying country and receiving country within the EU is different (Datafields BSEG-EGLLD and EGBLD) and VAT has been charged (Datafield BSEG-MWSTS).

 

Topics: outgoing invoice, SAP, Audit, order to cash

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