Third Party Recovery
Financial Dictionary — Accounts Payable & Receivable
Definition
Third Party Recovery normally refers to delinquent accounts receivable recovered by a collection agency for a fee.
Common Uses
- Used in the purchase-to-pay cycle to validate invoices, approvals, and supporting documents.
- Used to strengthen internal controls over purchasing and supplier payments.
- Used to strengthen internal controls over purchasing and supplier payments.
Practical Example
- Example: Before payment, the AP team applies **Third Party Recovery** to confirm the invoice matches the approved purchase documentation.
Why This Term Matters
- Why it matters: Prevents incorrect/duplicate payments, reduces fraud risk, and improves accuracy of payables and expenses.