Accounts Payable Management

No matter what size your business is or what industry you are operating in, paying vendors will always be part of it.

accounts-payable-management

Accounts payable management refers to set of policies, procedures and practice followed by a company to manage its purchases. No matter what size your business is or what industry you are operating in, paying vendors will always be part of it. Some organizations have separate full-fledged accounts payable team or some manages this within accounting team.  By implementing best business practices you can streamline your accounts payable process and be prepared for future growth.

Our accounts payable services ensure accurate and timely payments to suppliers for goods or services received, thereby ensuring proper controls over the payables function of the company. 

Following are the opportunity areas of AP Management:

  • Insight into the vendor – risk / negotiations/credit limit/credit period
  • Reduce time - invoice acceptance & pay
  • Adherence to purchase order policy
  • Listen and solve vendor issues
  • Send list of open invoices to the vendor
  • Conduct regular reconciliations
  • Getting sign offs at fixed intervals

Following are few tips to have a good account payable mechanism in place

  • Reduce the number of payment runs, two runs per month are ideal
  • Invoice backup for each & every payment run
  • Make full use of credit period agreed with vendor
  • Have cash disbursement ceiling for every payment run
  • Have authority to limited people to open a new vendor in accounting sytem
  • Use technology to process vendor invoice
  • Separation of duties, approval from departmental heads
  • Use purchase order for each service/material to be procured. If purchase order policy not there, draft the same.
  • Minimize payment of advance
  • Carry out signoff/reconciliation with vendors

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