Will a largish company notice an overpaid invoice?
Discussion
A largish company i do electrical works for has paid me £1758 for an invoice of £1578.
So clearly the finance woman has had a slip of the fingers.
Now if it was an individual or small business i would probably tell them, but they are a sizeable company who seems to take 3 months to pay me, so i don't feel as inclined to tell them...
End of the day its only £180, and if they notice i will send it back to them or take it off a next invoice, while pleading i never noticed
But how likely are to notice? when they notice the income to expenditure does not balance, would they go looking for where, or just write off such a small amount?
So clearly the finance woman has had a slip of the fingers.
Now if it was an individual or small business i would probably tell them, but they are a sizeable company who seems to take 3 months to pay me, so i don't feel as inclined to tell them...
End of the day its only £180, and if they notice i will send it back to them or take it off a next invoice, while pleading i never noticed
But how likely are to notice? when they notice the income to expenditure does not balance, would they go looking for where, or just write off such a small amount?
Contract Killer said:
A largish company i do electrical works for has paid me £1758 for an invoice of £1578.
So clearly the finance woman has had a slip of the fingers.
Now if it was an individual or small business i would probably tell them, but they are a sizeable company who seems to take 3 months to pay me, so i don't feel as inclined to tell them...
End of the day its only £180, and if they notice i will send it back to them or take it off a next invoice, while pleading i never noticed
But how likely are to notice? when they notice the income to expenditure does not balance, would they go looking for where, or just write off such a small amount?
the chances are their accounts do balance. It's most likely that somebody entered your invoice incorrectly in the first place. It;s possible an Audit or VAT inspection would pick up their error. So clearly the finance woman has had a slip of the fingers.
Now if it was an individual or small business i would probably tell them, but they are a sizeable company who seems to take 3 months to pay me, so i don't feel as inclined to tell them...
End of the day its only £180, and if they notice i will send it back to them or take it off a next invoice, while pleading i never noticed
But how likely are to notice? when they notice the income to expenditure does not balance, would they go looking for where, or just write off such a small amount?
However, more significant is that it's your accounts which won't balance, and the only way to correctly account for the overpayment is to book it as a liability.
Doofus said:
the chances are their accounts do balance. It's most likely that somebody entered your invoice incorrectly in the first place. It;s possible an Audit or VAT inspection would pick up their error.
Potentially an Internal Audit might pick it up. It's highly unlikely that an External audit would and it's irrelevant from a VAT audit perspective. The AP system would have calculated the VAT automatically when the invoice was processed. The main way it "might" be picked up is if the budget holder looks at his/her monthly variance reports but that is dependent on the size of the budget and the size of the project. it's quite normal/routine for invoices to vary by X% so it might be picked up, it might not. Probably not IME.Doofus said:
However, more significant is that it's your accounts which won't balance, and the only way to correctly account for the overpayment is to book it as a liability.
Easy fix - raise another invoice to same supplier for £180. Allocate 1578 income to first invoice and 180 to second invoice.Personally speaking I'd contact them to let them know they've overpaid.
Countdown said:
Potentially an Internal Audit might pick it up. It's highly unlikely that an External audit would and it's irrelevant from a VAT audit perspective. The AP system would have calculated the VAT automatically when the invoice was processed.
It's unlikely, but not impossible that it would be picked up in an external audit and, if you've ever had a VAT inspection, you should know that it would definitely not be 'irrelevant' to them. The AP system should calculate VAT automatically, but if the net, or more likely, the gross value of the invoice was entered incorrectly them the VAT will also be wrong when checked against the original invoice
Contract Killer said:
End of the day its only £180, and if they notice i will send it back to them or take it off a next invoice, while pleading i never noticed
...... would they go looking for where, or just write off such a small amount?
Both a question of the law and morals here!! A very easy answer to something that shouldn't even be a question.
If you do quite a bit of work for them haven't you got more to loose if cought out by being decietful?
Receive the payment, clear the invoice on your system and post the over payment as a payment on account.
Then you can either inform them of their over payment and ask them if they would like it returned, or held on account to use against a future invoice, or keep schtum, it's up to you.
Either way, don't try and claim it by invoicing the over payment, it's not yours to claim.
Then you can either inform them of their over payment and ask them if they would like it returned, or held on account to use against a future invoice, or keep schtum, it's up to you.
Either way, don't try and claim it by invoicing the over payment, it's not yours to claim.
I’d tell them OP. If they’re taking too long to pay, before they want more work doing demand payment on anything owing before more work continues and put terms down you’re more happy with. I’ve lost some customers doing this but they would often cause issues beyond being slow in payment anyway, so it was a kind of win win.
Doofus said:
Countdown said:
Easy fix - raise another invoice to same supplier for £180. Allocate 1578 income to first invoice and 180 to second invoice.
Oh... Commit fraud, you mean. Yeah, that's a good idea.Doofus said:
Countdown said:
Potentially an Internal Audit might pick it up. It's highly unlikely that an External audit would and it's irrelevant from a VAT audit perspective. The AP system would have calculated the VAT automatically when the invoice was processed.
It's unlikely, but not impossible that it would be picked up in an external audit and, if you've ever had a VAT inspection, you should know that it would definitely not be 'irrelevant' to them. The AP system should calculate VAT automatically, but if the net, or more likely, the gross value of the invoice was entered incorrectly them the VAT will also be wrong when checked against the original invoiceNot quite the same but I do a fair bit of work for a largeish company, they meant to add a £250 tip onto one of my payments but accidentally paid £2500. It took me a while to work out what it was as I wasn't expecting a tip anyway..
I phoned the person I deal with at their office who was very grateful, but did admit that they would never have noticed if I hadn't pointed it out.
This was a few years ago and I've had a lot of work from them since so it paid dividends, and I would have felt guilty for evermore had I kept schtum.
I phoned the person I deal with at their office who was very grateful, but did admit that they would never have noticed if I hadn't pointed it out.
This was a few years ago and I've had a lot of work from them since so it paid dividends, and I would have felt guilty for evermore had I kept schtum.
The simplest thing to do is allocate the overpayment as a credit on their account. Then when/if you send them a statement it will show up. Or if they query the overpayment in future you can legitimately say it is a credit on their account as they overpayed on the original invoice.
I have clients who have overpaid in this way and they often seem to ignore the credit on the statements and carry on paying as normal.
This way you are not trying to hide anything without chasing them up on their generosity.
I have clients who have overpaid in this way and they often seem to ignore the credit on the statements and carry on paying as normal.
This way you are not trying to hide anything without chasing them up on their generosity.
Just return it and who knows, they may agree better terms for future business or be inclined to work with you more.....
I hear what you say if it's bad business. However, even then you need to question is it really worth the hassle further down the line to sort if this comes round again....
I hear what you say if it's bad business. However, even then you need to question is it really worth the hassle further down the line to sort if this comes round again....
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