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A simple way to verify freight bills, using freight audit services

by BlogFreight Audit

Freight Audit Services help in auditing the process which is essential for shipping companies. Shipping large volumes of goods at a fast pace and at less cost is vital for shipping businesses. Freight are shipments that weigh more than 150 lbs. Transportation of freight is a complex logistic process. Shippers have to pay freight bills to shipping carriers for freight transportation.

Factors like modes of freight transportation, distance, type of shipping goods influence the invoice amount. An audit is required to verify the invoices. In this article, we will discuss freight audits, their types, and the benefits of using freight audit services.

Overview of Freight transportation modes

There are different modes of freight transportation: road, air, maritime, rail, intermodal, and multimodal.  Transporting goods by these modes have a different impact on businesses.

Road transport is the most popular mode of transportation used by shippers. Businesses that transport thousands of packages use trucks or trailers. There are two types of road transport: Full Truck Load (FTL) and Less-than-Truck Load (LTL). In FTL, shippers can ship a truckload of freight and pay for the full truck. While, in LTL, shippers only pay for the part of the truck that contains their goods but takes a longer shipping time.

Maritime (Ocean) transportation is the slowest mode but transports the highest volume of freight. They are two types: Full Container Load (FCL) and Less-than-Container Load (LCL).

Air cargo transportation is the fastest mode of transportation for shippers. Shipping carriers transport high-value freight and require quick delivery by this mode.

What is Freight Audit?

A business process where a shipper’s freight bills undergo examination, analysis, and verification is a Freight Audit. Freight bills are invoices from a shipping carrier to a shipper. Advanced software is in use to analyze freight bills for accuracy. A freight audit finds billing inaccuracies and saves money for shipping businesses.

Types of Freight Audit

A freight audit process can be manual, automated, or a combination of both. A Manual Freight Audit process is time-consuming and may lead to errors. The Automated Freight Audit process uses sophisticated software to give consistent and quick results. There are different types of audits based on factors affecting the freight invoices.

1. Freight rate audit

Shippers and carriers decide on a tariff for freight transportation.  Freight rate auditing checks the freight bill entry process. The audit is on the transportation charges and discounts. The shippers find it hard to calculate tariff rates as it varies based on a variety of parameters like shipper address (city, state, country, zip) to consignee address (city, state, country, zip), the permutations and combinations are generally exponentially high. Automated freight rate audit of Audintel can verify the freight rates charged by shipping carriers. We identify if there is overcharging or tariff rate change by the shipping carriers. We will raise a dispute with the carrier and get the carrier to properly charge the client.

2. Duplicate Invoice audit

An audit helps in identifying shipments that have multiple duplicate invoices. For example, if a single consignment has two closely matching invoice numbers, shippers may end up paying twice. Audintel conducts audits on shipments based on parameters such as invoice date, the weight of the shipment, bill of lading (BOL), invoice amount to prevent duplicate invoicing. Invoices that are duplicates are moved to zeropayclose and not forwarded to the client for payment.

3. Three-way Match audit

A three-way match audit involves three parties, the shipper, shipping carrier, and the auditor. It requires matching the invoice of the shipping carrier with the shipper’s match file. The match file comprises invoice records and estimated shipping price. The auditor compares the files and invoices to check for any errors in the invoice of the carrier.

4. Surcharge Audit

Other than transporting charges, freight carriers offer facilities to shippers. The facilities include lift gate charges, toll fees, additional handling charges, and more. There is an agreement between our client and shipping carriers regarding fees. Audintel audits surcharge levied by the shipping carriers and ensures that there is no overcharging.

5. Fuel Surcharge Audit

Fuel costs vary every day. The U.S. Energy Information Administration (EIA) announces weekly fuel prices on its website. The freight carriers adjust the fuel surcharge amount based on EIA published fuel prices based on the pre-agreed weekly days with the client. Audintel is a freight audit service provider that monitors any additional fuel surcharge applied by the shipping carriers during shipment.

Benefits of Freight Audit Services offered by Audintel

Audintel saves money for its customers with its freight audit services. It is a tall claim. Our customers can see the benefits of partnering with us. Our software helps customers

  • Review freight invoices
  • Minimize billing errors
  • Save time and money
  • Optimize supply chain operations
  • Calculate fuel surcharge rates
  • Make the freight billing process simple

Audintel has the best freight audit software that takes care of shippers’ freight billing.

To summarize

Shippers need to invest time and resources to verify freight bills.  Businesses are losing money and time by manually tracking freight bills. Shipping businesses recover 5% to 10% of their freight costs through auditing. By using freight audit software, shippers have better control over their transportation expenses. Freight auditing is a way to control a shipper’s freight spend. Audintel is providing real-time information through its intuitive dashboard. We use state-of-the-art technology to audit freight invoices and save money for our customers. For further details, write to us at info@audintel.com or please visit our Audintel website or call us at +1 (619) 354 8539.

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Reasons to consider a Freight audit software solution

by BlogFreight Audit

Freight Audit Software Solution

The freight audit software solution will help companies save costs incurred through invoices. This will, in turn, have a huge impact on their annual profits.

Nowadays charges from various transporters are negotiated and impacted by the oil market. Without a firm understanding of all the intricacies of the shipping industry, a company is always at risk of being consistently over-charged. That is why many businesses turn to a freight audit software provider or a freight audit and payment company. Audit companies handle the laborious task of auditing their freight bills.

Most of the companies will not be able to handle the massive task of processing, organizing, auditing, and paying the carrier companies. It is not only time-consuming but also requires dedicated internal staff. The opportunity to maximize your profit margin through business intelligence will be missed if your company does not take advantage of the intelligence gained from the data.

Freight Bill Audit and Pay

So freight bill audit and freight payment software is an essential component of any business. Many companies do not utilize technology to manage freight bills, resulting in a lost opportunity for multiple cost savings.

The old-school way of manually processing freight bills and hoping for the best overlooks many important and potentially expensive factors. Some companies shipping and receiving more than hundreds of shipments every month, resulting in paperwork in different formats from carriers. In the long run, this will become overwhelming, and inevitable errors get cropped in either from human inaccuracy or a processing mistake.

Discrepancies In Freight Bills

But if your company is being regularly wrongly billed, the costs add up quickly. Most companies do not have the resources to devote to auditing every single bill, so some will resort to a random check, giving the organization only a sample of the entire picture. This will result in risking the forfeit of any lost capital due to overpayment, errors, hidden fees, or redundant costs.

It should be clear that a sound strategy is a priority when it comes to Freight Auditing and Payment. Experts estimate that a company can expect freight charges to typically represent up to 10% of a company’s total cost of goods. It is a significant enough portion to pay attention to and to apply the most effective tactics to minimize.

Freight Paper Invoices

Paper invoices run the risk of becoming lost, and a company loses the ability to analyze bills and data. The cost to internally process and pay freight invoices can be measured at around $11-$12 per invoice. Along with the cost of allocating manpower to perform this laborious task, human inaccuracies or inattention to unforeseen factors may choke even the most well-intentioned internal department. Also, the opportunity to file a claim for reimbursement for any error is typically 180 days and must be handled on time.

Freight Bill Auditing Process

The freight audit company follows a specific process to confirm all inaccuracies are noted and corrected. It provides the client with a detailed evaluation of their shipping and receiving procedure based on ad hoc data. The process begins when the shipping invoice is received either manually or through EDI. The freight audit company will then verify the bill, inspect for errors or inaccuracies, and ensure that:

  • The invoice has not been previously paid or is not a duplicate,
  • Is indeed the responsibility of the shipper to pay,
  • Any tariffs were calculated correctly,
  • Accessorial charges are legitimate and
  • All necessary documentation such as the Bill of Lading and purchase order numbers are included.

They will file a claim to be reimbursed for the mistake or oversight whenever inaccuracies are spotted. If they are assigned to make the payments as well, they will handle the processing of the bill to ensure that it arrives as scheduled.

Audintel’s role :

We at Audintel have a freight audit software solution, which consists of various audit checkpoints to capture any discrepancies done by the carriers. We provide business intelligence reporting which can be used for detailed insights and also plan a better strategy when compared to the competitors. For further queries, please visit Audintel or contact us at +1 (619) 354 8539 or mail to info@audintel.com.

Need for Freight Audit

Why do we need a Freight Audit?

by BlogFreight Audit

What is a Freight Audit?

Freight auditing is typically provided by an external audit company.  They carefully inspect the carrier invoices and look out for all the inaccuracies in the carrier invoices. Inaccuracies can include billing errors, incorrectly classified shipments, unapplied tariff weight breaks.

This audit will help a company to prevent over-billing, negotiate future shipping rates and choose better transportation strategies along with the most efficient carriers.

Nowadays freight rates and freight pricing in the logistics industry are becoming increasingly complex, and carriers make innumerable mistakes and also fail to meet service level agreements. And thus shippers use freight auditing as a tool. This tool ensures that the shippers pay carriers only after determining that the freight invoices are 100 % accurate and precise.

Rates in the LTL industry are very complex. They are calculated by a range of factors which include mileage, cost of diesel, product type, pickup, and delivery fees. Some of these fees and charges are negotiated with the shipper. Carriers can always add new charges or sometimes they increase existing charges also. For this reason, it is very difficult to track a company’s freight bills to ensure that they are accurate.

Carrier Formats and Error Frequency

Making matters more difficult is the fact that a company almost certainly uses more than one carrier, and each carrier’s invoices are different from one another and they all use different formats. This task becomes challenging when there are potentially hundreds and thousands of items to ship every month. And due to the large volumes of shipments, many errors go unnoticed and undetected.

One out of every four freight bills contains an error that could affect the company’s finances. Manual auditing and freight payment are time-consuming and often require additional administrative staff and time. For companies who lack these resources, they can save time and money by outsourcing freight Audit to an external audit company who has expertise in capturing all the errors and also using the auditing software.

Freight Audit Software

Examination of freight bills is a business process. Freight bill’s duplicates and accuracy are adjusted and verified. Now the shipper can stop wasting the time of their Accounts Payable department on the grueling, time-sensitive process of auditing, while also bringing in extra money at the same time. The shipping company has to pay the cost when there are overpayments. There are also other benefits like actionable data that can be used to negotiate better rates with the carriers.

Freight Invoice

Carriers submit an invoice to the customer or an external audit company, this invoice is the freight bill. Audit companies approach the respective carrier when there are errors in the shipper’s invoice. They suggest the carriers to correct and generate a new invoice. Here at AudIntel, as a leading freight audit provider, we ensure that shippers are not overcharging for their freight services. For example, in the shipping world, overpayments occur far too often. Carriers like FedEx freight/UPS freight delivers an average of 9 million packages in 220 countries every day. Hence the mistakes are inevitable. As a result, the freight audit service ensures that your actual freight invoice matches the quote.

AudIntel’s role in freight audit 

We at AudIntel, do many explicit audit checks on various types of freight invoices. This makes sure that even the smallest of discrepancies are captured. This in turn saves a good share of money for the shippers. And also provide data insights showcasing trends for revenue, shipments, accessorials, carriers, etc. For further queries, please visit Audintel or contact at +1 (619) 354 8539 or mail to info@audintel.com.