One Utility Audit vs. Joining a Utility Audit Program
Many companies have become painfully aware of the excessive number of costly errors resulting in overcharges. These can regularly occur on bills and invoices from utility companies. Even an incorrect amount on one line of an invoice can result in several charges, costing some companies hundreds of thousands of dollars. When times are difficult, it can be a challenge to keep a business afloat. Inaccurate and unapplicable charges which appear on invoices result in needless depletion of an enterprise’s bottom line.
But dedicating employee hours to the task of poring over every bill and comparing data from various sources is impractical. Arranging a utility audit is a better answer to the problem of prolific billing errors. More specifically, a utility audit program is a much better option than arranging a single utility audit as a spot check and failing to follow up. A recurring audit program can help ensure statements from other utilities aren’t draining your budget and prompting expensive payouts for incorrect charges.
Inaccuracies Occur Frequently in Modern Billing
The frequency of billing mistakes is increasing. Human workers are frequently stressed and distracted, making them more likely to overlook errors. Though automation helps minimize human errors, automated programs can even contribute to the problem in some cases. Once an error in programming occurs or an incorrect entry is fed into the system, a simple one-line error can have a snowball effect as the automated billing process proceeds. A massive overcharge may result. Utility audits — or, better yet, a utility audit program — can help to prevent that threat.
The Problem With Limited Utility Audits
Conducting ongoing audits limited to one or two utilities or booking a comprehensive utility audit just once doesn’t make sense. Conducting a one-time utility audit but neglecting to verify the accuracy of your accounts payable system on a regular basis leaves the door open for costly, unnecessary payouts for mistakes.
Picture your business as a ship, with each billing mistake symbolized as a leak. If your hull suffered seven blows which created eight holes and the ocean water was rushing in, you wouldn’t just plug one hole. You would fix all the leaks immediately. Then you would install a preventive maintenance system to detect and repair future breaches before they could threaten your ship and crew.
An ongoing, comprehensive utility auditing program offers protection against holes in your bottom line due to utility billing errors that could overwhelm your budget and sink your business.
A Utility Audit Program Can Rescue a Company Swamped by Overcharges
Strategic options that actually assist in cost containment are valuable resources for businesses. Utility audits can save companies surprising dollar totals in overcharges. Joining a utility audit program is much more effective than arranging for a single utility audit. Our company’s experience shows that in most cases when at least three cost centers are covered in an audit, errors are detected, and significant cost savings are realized.
The Greatest Savings Are Realized by an Across-the-Board Utility Audit
A one-time audit might catch a few errors. But you won’t reap the ongoing savings and benefits that come with joining a program.
Returning to the sinking ship analogy, your vessel would still be taking on a great deal of water if you only arranged to plug one or two holes. The same thing happens when your company only addresses one or two types of utility costs. Joining a utility audit program provides the greatest possible savings.
What Utilities Can Be Audited?
Any utility or cost center expense can be addressed in an audit program. Here are a few prominent examples:
- Waste removal
- Merchant processing
- Workers’ compensation insurance
- 401(k)/403(b) plan administration fees.
Our company also consults on cost containment services; Cost segregation, virtual card platforms, and LED lighting projects qualify.
A Track Record of Results for Clients: A Cost Center Study Overview
Cost center audits also offer significant savings to companies.
Altar’d State, a large national apparel/accessories retailer, retained our company to review its operational expenses. The expenses reviewed were electricity, shipping, workers’ compensation plans, and payroll and employee benefits.
Our audit of their shipping provider helped them negotiate aspects of the company’s small package spend with their shipping carrier — even though they had renegotiated their agreement three months prior to our involvement. Cost reductions are expected to bring $1.2M in annual savings.
The Technological Advantage
In the utility space, technology is our competitive advantage and our secret weapon. We combine years of cost auditing expertise with a cutting-edge audit progress tracking and document management system that features a client reporting dashboard and exposes errors clearly. Util Auditors streamlines the entire process for a seamless end-user experience. Unlike other auditing services that “use” technology, our team of professionals embraces it. Visibility is one of the most important considerations when completing a multi-audit project that potentially includes many locations.
As a client, you want to know what we find. You also want to know in what cost centers we found it and what net benefits you can expect. Our experience tells us that being thorough and having a clearly defined audit strategy is the way to catch errors, maximize savings, and garner refunds. That’s the reason we’ve created uVIEW™. It’s a holistic dashboard where clients track the progress of each audit, at each location, in real time.
When conducting your audits, you want to clearly outline the categories of spending you plan to audit. It’s also important to include estimated savings from each category as outlined below.
Our portal provides updates for each audit at each location in progress, including steps like:
- Reviewing Documentation
- Need Additional Information
- Audit In Progress
- Potential Reduction and/or Refunds Identified – Please Review
Additionally, you will be able to view notes on each audit as provided by the auditor. You will have the ability to respond to questions or requests within the portal.
Now Is the Right Time to Set up a Utility Audit Program
Joining a utility audit program is the best move you can make to find ways to save on costs. But one utility audit may not be enough. A comprehensive and continuing plan to reduce unnecessary errors and additional utility and cost center expenses offers the potential to plug the holes in your company’s budget and strengthen your bottom line.
It’s time to take action to identify significant discrepancies and opportunities for refunds in your bills. To request a utility audit, or to learn more about our utility audit program, contact us.