Finance

Revenue leakage

Also called: Margin leakage · Revenue leak

Money that was earned but never collected, or paid out when it was not owed, through failures of process and data rather than of commercial judgement.

Leakage is distinct from a bad deal. A bad deal is a decision you made; leakage is money that escaped without any decision at all — an unclaimed entitlement, a claim paid without validation, a transaction that failed to match its agreement, a fund drawn without evidence.

It is systematically under-measured because most of it does not error. Nothing fails, nothing alerts; the transaction just does not accrue, or the claim just is not raised, and the loss shows up months later as unexplained margin variance.

In our taxonomy there are nine repeatable sources, each with a financial cause and a systems cause, and each with a benchmark you can measure against your own data.

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