Freight auditing refers to the process of checking invoices from shipping companies to ensure their accuracy. Freight costs have risen in recent years due to higher transportation costs and errors made by freight shipping companies can represent a substantial additional cost. Regularly performing a freight audit can result in significant savings.
Such an audit involves checking the following:
• Validity of an invoice
• Any shipping errors made
• Whether any discounts were applied
• Service agreements have been met
• The presence of duplicate invoices
• Whether the correct tariff was applied
Freight audits can be performed manually, through auditing software or by outsourcing to an auditing firm. Manual audits can be time-consuming because of the large numbers of invoices and complex agreements that need to be reconciled. Software is available into which invoices are entered that automates this process but many businesses opt to outsource this function.