Freight Audit Checklist – 10 Steps for a best practice Freight Audit

Step 1. Request detailed Excel invoices from your carriers

  • If you don’t have them, request them from your carrier, pdf invoices are used as a reference where they may have some additional information that the Excel copy does not.
  • No summary invoices e.g. you sent 25 3kg satchels this week at $X; itemized per consignment / order invoices with charge weight if cents per kilo rate structure.

Step 2. Establish a general scope & a timeframe for the Freight Audit

  • 6 – 12 months should suffice
  • Are you doing all carriers, all sites?
    • Or one carrier first?
    • If you are aware of a problem with a particular site or carrier maybe focus on that first

Step 3. Collate your Freight Invoices to match the Scope

  • Have a process to save all invoices by carrier and month; per site, so it is easy to collate the relevant invoices for the Freight Audit project

Step 4. Carrier, Service, Ex Location Rate Cards

  • Now you need the rate card files that are affected by the Freight Audit
  • Again csv / excel is easier to manage; if you don’t have them liaise with your carrier
  • Take note if there was any rate increases over the time period you are reviewing;
    • If there is, you need the old rate cards and the new rate cards and to note carefully when the invoices cross over to the new ones
    • Where the new rate cards signed and agreed upon?
    • What are the contract details, is there anything not covered off in the new rates?

Step 5. Matching Zones & Postcode Files to Rate Cards

  • Most rate cards need a matching Zone and postcode file to allow for accurate consignment estimates
  • Carriers will have unique zones e.g. NSW Zone 1 – 5 that match to different postcodes and town names
  • These rate zones will have different prices ex the sending location that form a big part of the costing of each consignment
  • Csv / Excel again is the preference for easy management
  • Your account Manager should be able to supply one; otherwise you will need a consultant to build one for you

Step 6. Manifest File Data

  • Some type of Manifest file data is needed to confirm your historic freight activity against what the carrier says (in invoice) you sent; typically sourced from:
    • EDI file transfer to carrier billing systems
    • Your TMS system

Step 7. Cross Verify the data from the 3 data sets: freight invoices; rate cards (& zone postcode files); and manifest data

  • By far the easiest way to manage this process is via a niche system provided by a Third-Party Freight Auditing consultancy
  • An FMS system may have an invoice reconciliation reporting function;
    • But that is best used on a regular basis moving forward
    • It still requires a trained resource who can commit up to an hour per invoice each week to run
    • FMS reconciliation process may not include post dispatching fees such as manual handling surcharges check your providers SLA for the scope of the task

Step 8 Consignment Verification

  • Compare Freight activity from manifest file to invoice file looking for:
    • Consignment (tracking) numbers that are not on your manifest file; error: not your consignment (another customer of the carrier’s consignment)
    • Consignment (tracking) numbers that are duplicated; error: double charge
  • Disparity in Freight Charge:
    • Freight Invoice Charge vs. Estimated Charge from current (relevant) rate card as compared to the manifest file
    • Highlight any overcharges in the invoice
    • Look for reason for different charge, such as:
      • Correct rate applied? Look at:
        • Per kgs and any weight breaks
        • Per item rates e.g. per satchel or per pallet
        • Service match: Priority, road express, General, etc.
      • Different Zone assigned to Receiver’s Destination suburb/postcode
      • Charge weight (cubic or ‘dead’ weight) is different; any overlength surcharges applied?
      • Wrong item applied, wrong number of items?
      • Is the Fuel Charge accurate for the time period e.g. month of May?
      • Is there a Surcharge applied that accounts for discrepancy?

Step 9. Create a Credit Request

  • Add a column at the end of reconciliation report that has the dollar amount over charge and auto sum at the bottom the results
  • Apply a note column after the overcharge amount that notes the reason for the overcharge, such as:
    • Wrong Zone should be Zone 1 NSW not Zone 2
    • Not our consignment
    • Length should be 20cms in length not 200cms; Charge weight = 0.04cm; plus, no Over-Length Surcharge applicable
  • Summarise Credits for each carrier; each week; and connect with your Reconciliation Report
  • You should let your carrier know beforehand to expect these reports rather than surprise them; perhaps when you are liaising with your Account Manager for latest rate cards, or to start receiving Excel invoices

Step 10. Negotiate Credits

  • Phone your Carrier Account Manager to get their assistance with liaising with their Accounts Department to start a process for claiming your Credits
  • Send Reports through and have a teleconference if needed to discuss
  • Longer term overcharges may need negotiation of a process for payment i.e. carrier might discount upcoming invoices for a time period to pay back the overcharges if the amount is considerable

Post Freight Audit

Troubleshoot Issues

Although technically finished with the freight Audit you will need to take steps to ensure that lessons are learnt from the process, and improvements implemented.

  • The Freight Audit process may highlight issues at your warehouse end or at the carrier’s end for systemic issues; patterns of issues that crop up consistently over the review time period
  • Isolate the source of the error(s) and work though the errors in conjunction with your carrier
  • Rate Cards and Contracts may need to be resigned once accuracy & agreement is achieved

Carrier Invoice Reconciliation

After the Freight Audit has been completed you should implement a Carrier Invoice Reconciliation process. 

  • Review all carrier invoices on a weekly basis moving forward to:
    • Ensure patterns of overcharge issues have been effectively dealt with
    • Ensure no new issues crop up unexpectedly

Freight Business Intelligence Reports

  • Best practice would also suggest that, in concert with a Carrier Invoice Reconciliation process, you should use your captured reconciled freight data to build reports on freight activity and costs to assist with your freight management optimization goals


As you can see a Freight Audit can be a very involved process which is almost impossible and possibly not worth the investment of time and money to manually conduct with your own resources.

If you have some automation, in the form of an FMS system, you may be able to conduct this internally, but you must allocate the right staff to the project and ensure you have looked at the time this will take and the opportunity cost to your business.

Ultimately a series of spreadsheets to conduct this project will not be sufficient, nor will it get to the level of granular detail of a bespoke solution that includes the right people to assist with credit negotiations and trouble-shooting of errors.

Therefore, the most efficient and cost-effective method is to use experienced third-party freight management specialists that offer invoice reconciliation and Freight Auditing services.

If you would like to know more about our solution for this important freight management task, please get in touch for a free consultation.

Related Articles: 

What is a Freight Audit (and why should you conduct one)?

Why you Should Outsource your Freight Audit

How to Source the Best Freight Audit Companies

Freight Audit: Credit Notes, Payment Process, and Logistics Errors

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