Use Case | Accounts Receivable and Payable Audit in the Financial Sector

Use Case: Accounts Receivable and Payable Audit in the Financial Sector

General Description:
Accounts receivable and payable audits are essential to ensure the accuracy of financial records, identify errors, and detect potential fraud. This generative model enables automatic analysis of PDF documents such as invoices, statements, and payment records to detect inconsistencies, verify compliance with internal policies, and generate detailed reports. This optimizes the audit process, reduces the time required for reviews, and improves the accuracy of financial records.

How It Works:

1. Uploading Accounts Receivable and Payable Documents:
   • Users upload documents such as invoices, receipts, account statements, and pending payment reports in PDF format.
2. Extraction of Key Information:
   • The model extracts relevant data such as:
     • Invoice and payment amounts
     • Issue, due, and payment dates
     • Client or supplier details
     • Transaction references
3. Consistency and Compliance Analysis:
   • The system compares the extracted information with internal accounting records to:
     • Detect duplicate payments or unpaid invoices
     • Identify discrepancies in amounts or dates
     • Verify that outstanding balances match internal records
4. Anomaly and Risk Detection:
   • Identifies potential issues such as:
     • Overdue invoices without follow-up
     • Payments made but not properly recorded
     • Clients with recurring non-compliance patterns
5. Audit Report Generation:
   • Provides a detailed report with:
     • Summary of audited accounts
     • Invoices and payments requiring attention
     • Recommendations for correcting errors or improving processes

Practical Example:
Scenario:
A manufacturing company needs to audit its accounts receivable and payable at the end of the quarter to ensure the accuracy of its financial reports.

Process with the Model:

1. Uploading Documents:
   • The company uploads issued invoices, customer account statements, and payment reports in PDF format.
2. Analysis and Verification:
   • The model extracts and analyzes the data:
     • Accounts Receivable:
       • Invoice A: $5,000, due on 03/15/2024, unpaid
       • Invoice B: $3,000, paid on 03/10/2024
     • Accounts Payable:
       • Payment made to Supplier X: $2,000, correctly recorded
       • Duplicate payment to Supplier Y: $1,500, detected in two separate records
3. Problem Detection:
   • Identifies that Invoice A is overdue and has no recorded follow-up.
   • Detects a duplicate payment to Supplier Y, leading to a potential overcharge.
4. Report Generation:
   • Report Summary:
     • Total accounts receivable audited: 50
     • Total accounts payable audited: 30
     • Problems detected:
       • Invoice A (unpaid, overdue)
       • Duplicate payment to Supplier Y ($1,500)
   • Recommendations:
     • Follow up immediately with the client on Invoice A.
     • Request a refund or adjust Supplier Y’s account for the duplicate payment.

Benefits of the Model in Accounts Receivable and Payable Audits:

1. Automation of the Audit Process:
   • Significantly reduces the time required to review large volumes of financial documents.
2. Precise Anomaly Detection:
   • Identifies errors and discrepancies that could go unnoticed in manual audits.
3. Improvement of Cash Flow:
   • Highlights overdue invoices and unrecorded payments to facilitate follow-up and recovery of outstanding balances.
4. Customized Report Generation:
   • Provides clear summaries and specific recommendations for each detected issue.
5. Scalability and Multilingual Support:
   • Analyzes documents in over 80 languages, ideal for companies with international operations.

Additional Applications:

1. Supplier Payment Control:
   • Verifies that payments made match received invoices and detects duplicate payments.
2. Customer Collection Follow-Up:
   • Identifies overdue accounts and clients with recurring non-compliance patterns to prioritize collection actions.
3. Fraud Prevention:
   • Detects suspicious payments or duplicate invoices that could be signs of fraud.
4. Regulatory Compliance:
   • Verifies that transactions comply with tax regulations and internal policies.
5. Accounting Process Optimization:
   • Automates account reconciliation, improving the accuracy and efficiency of accounting records.

Practical Example (Additional Scenario):
An international company audits its accounts receivable and payable to ensure compliance with local regulations in Europe, Asia, and America.

Without the model:

• Manually reviewing financial documents in multiple languages takes time and increases the risk of errors.

With the model:

• Automatically translates and analyzes the documents:
  • Europe: Identifies overdue invoices without follow-up.
  • Asia: Detects unrecorded payments in accounts payable.
  • America: Verifies that accounts receivable balances match accounting records.
• Generates a consolidated report highlighting region-specific issues, with clear recommendations for each case.

Conclusion:
Auditing accounts receivable and payable with this model ensures that financial records are accurate, consistent, and aligned with internal policies and applicable regulations. Its ability to analyze PDF documents, detect errors, and generate detailed reports makes it an indispensable tool for finance departments seeking to optimize their processes and reduce operational risks. Ideal for companies with large transaction volumes and global operations.