The anatomy of a freight invoice

November 16, 2015 Pieter Kinds


In the light of providing you with freight audit & payment insights, we continue our series regarding the freight invoice. In this blog we'd like to raise awareness about the undeniable errors and degree of inaccuracy of freight invoices in general, that could potentially cost you a large sum of money.

A freight Invoice… you receive, pay it and administrate it. Looks straight forward, right? At first sight, it is, and it can be, provided that you have implemented a solid freight audit & payment solution. Freight invoices, also called shipping invoice, freight bill or carrier's invoice, details the freight charges applicable to a shipment. Trucking companies and other freight transportation providers bill for their services using a freight invoice. For more information about freight invoices, I would recommend you to take a closer look at the following content:

The anatomy of a freight invoice

Freight Payment - 10 Freight Invoice facts that everyone should know

What is Freight Auditing and how does it save me money?

A Freight Invoice contains the following basic invoice content

- The word “Invoice” at the top of the document
- A unique reference number
- Date of issuance
- Supplier’s VAT
- Customer’s VAT
- Supplier’s name and contact details
- Customer’s name and contact details
- Description of the quantity and nature of the goods supplied or services rendered and Origin and destination points
- Product prices (if relevant)
- Date of the supply or payment
- Weight, volume, or measurement of freight
- Total amount charged (optionally with breakdown of taxes, if relevant)
- Payment terms (method and date of payment, late payment details)

So what is the news here? Well, plain and simple, your freight invoices contain errors, inaccuracies in the above-described content, and that often cost you money! View Infographic: 10 freight invoice facts you should know.

Why pay so much attention to your freight invoices?

Furthermore, for many organizations there is plenty of room for process improvement in terms of freight invoice processing and freight payment. Aberdeen Group often publishes studies on this topic. According to their study, it costs best in breed companies about $3.30 to process an invoice. That's for companies that are receiving freight invoices via EDI, electronically matching them, using automation functions with regards to freight payment. Outsourcing can bring the price down to $2.00 per processed invoice. With these facts in one hand, and the fact that freight and transportation account, on average, for up to 15% of all revenue for a company in the other, it’s highly recommendable to evaluate the current practices and processes in your company regarding freight invoice auditing and freight payment.

What to look for when checking a Freight Invoice?

What to look for when checking a Freight Invoice?

I. Related to not accurate data on the (pdf) invoices:

1. Wrong PO number

2. Incorrect Shipper/ Carrier VAT number

3. Incorrect billing address

4. Responsible person from the Shipper’s side is not indicated

5. Incorrect total/VAT amount (mostly in Rate check process; when incorrect amount charged on the invoice, this one to be denied/credit not to be requested)

6. Incorrect invoice date (for e.g invoice date is taken from future)

II. Related to shipment data and calculation:

1. Incorrect shipment data that led to improper calculation (origin/destination point; weight; cbm values; parcel/pallets numbers; loading date)

2. Incorrect exchange rates applied

3. Duplicated shipments included in the same / different invoices

4. Accessorial charges (fuel surcharges) - Often reference number is missing and extra charges are not reviewed by shipper

Freight Invoice automation features Shippers can expect

- Receive Invoices using the most efficient method possible for your organization (EDI)
- Payment can be centralized and practically be automated
- Full 24/7 invoice visibility via online platform
- Reporting/Accruals do not need to be created anymore as it is available via Business Intelligence
- Insight in the extra costs in transportation that saves customer and carrier time in its handling
- The invoice is always in the same format and always correct
- Ad-hoc shipment process more visible and more efficient via integrated online shipment booking tool

What are the results / benefits of automated Freight Invoice Audit and Payment?

The added value of outsourcing freight audit & payment is one hand the guarantee on ROI and effective / time-reducing processing of freight invoices. On the other hand, well-developed freight audit providers offer Business Intelligence and Transportation Data solutions that will strongly enhance the reporting capabilities for logistics and finance departments.

- Reduction of freight cost by 2-5%
- Elimination of paper invoice trails
- Automate manual handling points in the audit, coding and payment process
- Logistics managers are only involved in exceptions via an online tool
- Reduction of time spend on rate updates, exception handling
- Cost to serve analysis via Business Intelligence
- Full visibility of processes, data and carrier performance
- Freight Audit data is a good source for benchmarking and tendering
Turn your Invoice Data into Business Intelligence

“Best practice supply chain managers outsource freight audit functions mainly for the reporting capabilities”

The data from the freight audit process is for many transportation and logistics departments the basis for decision-making, cost control KPI’s, and process improvement and carrier benchmarking.
When changes need to be made in order to improve transportation processes, organizations need solid and waterproof data. There are still companies that lack the (full) data resources or finding difficulties extracting clean data from multiple sources, troubling the reporting capabilities. Primarily, there is the benefit of easily collecting some low hanging fruit. Some of the common quick wins be around consolidating and optimizing shipping lanes. For more information regarding the business intelligence capabilities and freight audit data possibilities, please contact us at

About ControlPay - Global Freight Audit & Payment

ControlPay is an advanced Freight Audit solution provider in the world. Although we are not a large company, 150 proud employees strong, we deliver our services around the globe to over 25 of the largest companies in the world, more than 500 sites, 1,000 carriers and over 10,000 satisfied users. We do this thanks to our award-winning cloud technology that drives our collaborative Freight Audit platform.

We are so pleased with its’ capabilities that we guarantee our customers on time processing of data and invoices from any part of the world, every day again.

More insights in freight invoice auditing

What is freight audit and how does it save me money
The evolution of Freight Audit
The benefits of strategic Freight Audit
Download our advanced freight audit e-book
ControlPay Business Intelligence
Freight Audit: Why ControlPay is different

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