5 Ways to Prevent Duplicate Payments in Property Management

The property management market in North America has grown to about $5 billion, but with that growth comes complexity. I've been working in property management for over 12 years, and I can tell you that the industry's accounting side of things is more layered than what you'd find in most other industries. Managing multiple properties means juggling dozens of clients, processing mountains of transactions every week, and constantly reconciling income, expenses, and assets. 

In the first week, you're paying for HVAC maintenance at three different buildings. Then the following week, you're processing landscaping invoices from the same company for five locations. Mistakes happen in the middle of all that. One of the biggest, costliest mistakes I've seen over and over again is duplicate payments. That's when you pay the same invoice twice - maybe the same vendor, the same product or service, just double the payment. 

Sometimes you catch the duplicate early, reverse it, and move on. But some slip through the cracks, and you don't realize what happened until a recovery audit months later. By then, the money's gone permanently. And the hard truth is that duplicate payments are more common than most people think. AP Now reports that about 25% of all invoices a company receives are duplicates. In this guide, I'm going to break down the hidden costs of duplicates, ways to prevent duplicate payments in property management, and the tools you can use to prevent them.       

5 Ways to Prevent Duplicate Payments in Property Management

According to the Association for Financial Professionals, duplicate payments eat up anywhere from 0.1% to 0.5% of a company's total disbursements. The Institute of Finance and Management numbers are even scarier. They say duplicates can hit 2% of all supplier invoices processed. Here's what happens in property management daily: Invoices get processed twice because different departments receive copies. 

Property managers forward invoices that AP has already entered. Invoice numbers get fat-fingered during data entry. Employees submit the same expense report twice because they forgot about the first submission. Construction projects, for example, involve multiple vendors and payments spread over months. It's easy to lose track. Purchase orders with multiple invoices create the same kind of nightmares. 

A single furniture order might generate separate invoices for delivery, setup, and warranty. It's easy to pay the same line item twice across different invoices. A study by Ardent Partners showed that a third of AP professionals spend more than 25% of their time chasing down these kinds of payment errors. But before I walk you through how duplicate payments actually happen, let’s talk about the hidden toll they take on your business. 

Hidden Costs of Duplicates

Duplicate payments hurt everyone, both small and large property management companies. The hidden costs go way beyond the obvious financial hits. Let me break down what destroys companies from the inside out. 

Wasted Time and Money

Someone on the AP team has to go back, find the mistake, and fix it. Then they've got to reach out to the vendor, explain what happened, and ask for the money back. The vendor's accounting team also gets pulled into the mess. They have to research their records, issue credits, and coordinate refunds. 

Some vendors just keep the overpayment as a credit against future invoices. That means cash flow takes a direct hit. For example, when you're carrying $200,000 in vendor credits that should be cash in your account, you can't use that money for property improvements or new acquisitions. Even worse, some vendors ignore the request altogether. 

Audit Problems  

The mess from duplicate payments spills over into cash flow forecasting, budgeting, and compliance reporting. External auditors see this mess as a red flag for weak internal controls. Since property management companies often handle trust funds and security deposits, and the industry is tightly regulated, this can open the door to compliance issues, financial restatements, and penalties.

Strained Vendor Relationships

Nothing damages vendor relationships like asking for money back several months after you overpaid them. They'd already spent the money on other things. And because vendors won't just send back the money simply because they saw an email requesting for money back, their AR team is forced to check and clean up the mess. That's extra work and stress for the team, and it cuts into their profits too. Over time, those kinds of errors erode trust. 

Missed Discounts

Another hidden cost is missed early payment discounts. When you think you've already paid an invoice but actually paid a different one as a duplicate, and the real invoice is still waiting to be approved, you fail to meet the payment deadlines and miss the discounts. Sometimes, even late fees pile up without your knowledge. 

Best-Practice Controls

About 0.05% of settled invoices are actually paid in error. That's a lot of money in property management, where you deal with thousands of invoices. Thankfully, here are some best-practice controls that are bulletproof in preventing duplicates. 

1. Clean Vendor Master

Your vendor master file is the backbone of your AP system. One of the most common ways duplicates slip through is when the same supplier has multiple entries in the master file. For instance, you have the same roofing contractor listed under three different names: ABC Roofing, ABC Roofing Inc., and ABC Roofing Company. So, same company, different records. You cut three checks before anyone realizes the mistake. That's why your AP system should only allow one active record per vendor. 

Unfortunately, 37% of finance teams only check suppliers during onboarding. Only 9% audit them monthly or more often. That means so many duplicate entries might never get caught until they cause problems. I suggest that you audit the vendor master file quarterly, not annually. Every vendor gets one unique Tax ID number. If a contractor gives you multiple business names, pick one and stick with it. 

Also, deactivate any vendor you haven't paid for over 15 months. If you've only paid them once and have no future plans, deactivate them too. It’s also advisable to limit vendor master file access to just a few people in your department. The cleaner your VMF, the fewer duplicate payments you'll face. 

2. Two- & Three-Way Matching

This is one of the best defenses against duplicate payments. Here's how it works: when your company places an order, it creates a purchase order. Once the goods or services arrive, you get the Goods Receipt Note. Then the supplier sends an invoice. With three-way matching, you verify that all three documents - PO, receipt, and invoice- match. If they don't match, the invoice goes on hold. Two-way matching is a lighter version that only compares the PO and invoice. Two-way matching is faster, but in my experience, three-way matching is worth the extra step.

3. Invoice Numbering Rules

Over the years, I've seen one simple problem cause a whole chain of expensive mistakes: the lack of a consistent system in invoice numbering. For example, the same roofing invoice arrives at three different places: your desk via email, the property manager's mailbox, and your purchasing department by fax. Then each person thinks they are the only ones who received it. That way, you'll end up paying for the services thrice. 

The solution to this problem starts with control. You have to centralize how invoices are received. For instance, you can move everything to one dedicated AP email inbox. From there, push all vendors to use a secure digital portal to submit invoices, so every document has a single point of entry. In short, employees shouldn't accept invoices directly. 

Then, after having a centralized point of entry, implement standardized numbering across all vendors. Each invoice should be assigned to an internal tracking number the moment it enters the system. This makes finding invoices during audits incredibly easy.

4. AI Duplicate Detection

Most ERP systems have some kind of duplicate detection tool built in, but they're basic and rely on exact matches across four data points: vendor name, invoice number, date, and amount. That's not enough. If even one character is off, say, a space in the vendor name or a slightly different date, the invoice will slip through and get paid. For instance, invoices for $5,000.00 and $5,000 get processed as separate payments because the system can't recognize they are identical. 

On the other hand, manual review is impossible when you're processing many invoices monthly. After all, human brains aren't designed to spot subtle differences across thousands of documents. That's why you should consider AI-powered automation tools. The software reads and understands invoices exactly like humans but with perfect memory, accuracy, and super high speed. The software analyzes vendor names, addresses, tax IDs, bank accounts, and other details in real-time. It compares every new invoice against the entire database instantly. 

Unlike humans, automated AP software can learn invoice patterns and pick up on subtle red flags. They can do things like flag an invoice with the same date and amounts, they can analyze the meta-data of a PDF and they can of course save you time so that you have the capacity to actually review your invoices! 

The statistics prove that AI duplicate detection is the way to go. According to PwC's Global Finance Survey, companies using AI-powered internal controls see 50% fewer financial errors and fraud incidents.  

5. Monthly Audits & Analytics

Finally, if you're not auditing regularly, you're just hoping for the best, and hope isn't a strategy. Start doing monthly reviews of all invoices, payments, and vendor records. With an automated AP software, that’ll be super fast and easy, and it’ll eventually become part of your routine. During these audits, look for gaps like poor matching practices, loose approval workflows, inconsistent data entry and duplicate vendor records.

Each audit will give you insight into what you need to fix. Also, analyze payment frequency by vendor. If a contractor who typically bills monthly suddenly submits three invoices in one week, that triggers further investigation. Finally, measure how many errors are caught before payment, how many are caught after, and how many slip through completely. Then keep improving.  

LeapAP's Duplicate-Screening Engine

Now let's talk about LeapAP's duplicate-screening engine because I know how it shuts down errors. LeapAP tackles duplicate payments in two ways: it prevents them upfront, and it rejects them on the back end. First, LeapAP connects directly to your utility providers like water, electric and gas, and automatically downloads the bills every billing cycle. 

The lack of human intervention means zero chance of duplicate payments since you won't have scenarios where someone printed one and emailed another. And since the bills are pulled straight from the source, there's no chance of paying the same one twice. 

The second layer is the duplicate-screening engine. The system will auto-reject clear duplicates, it will flag potential duplicates, and it has a global vendor list to to keep your vendor list clean. In short, LeapAP is a smart solution that tracks submissions and rejects duplicates.  

Final Thoughts

You can follow all the best practices I've laid out, and they will help. But here's my honest advice after 12+ years in property management accounting and AP automation: trying to stop duplicates manually is a losing game. Human error will always create gaps that cost you money. Then the time, energy, and money it takes to constantly chase down errors will always outweigh the cost of automation. 

If you do the math using an average of 0.1% to 0.5% of the company's disbursement we mentioned above, you’ll lose about $150,000 to $750,000 annually fighting duplicates on a $150 million disbursement volume. That's before counting the actual duplicate payments you have missed. Although most of the automated AP systems’ pricing isn’t in the public domain, I can bet the annual cost of most of them is less than what you will have lost to duplicate payments in a single quarter. 

‍