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Accounts Payable Best Practices

Mary S. Schaeffer

ISBN: 978-0-471-66758-2 June 2004 304 Pages


Have you ever wondered where your processes stand against industry leaders or how you can take your services and organizational procedures to state of the art levels? Are you frustrated because you don't think you have the finanical or human resources needed to employ 'best' practices? This handy resource provides documented strategies and tactics for accounts payable used by several highly admired companies. You'll gain practical knowledge you can turn into "Best" (or Almost Best) Practices as well as examples of practices to avoid.  

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Introduction xi

Chapter 1 Invoices 1

Invoice Handling: Approvals 1

Forwarding Invoices 6

Verifying Invoice Data 8

Invoice-Coding Standards 11

Short-Paying Invoices 16

Paying Small-Dollar Invoices 19

Handling Unidentified Invoices 21

Handling Invoices without Invoice Numbers 23

Case Study: How One Pro Took Accounts Payable Out of the Picture when Resolving Customer Discrepancies 25

Chapter 2 Checks 29

Check Printing 29

Check Signing 35

Check Stock Storage 40

Distribution of Checks 42

Check Fraud 45

Rush or Emergency Checks 50

Case Study: Information Sheet: Segregation of Duties 54

Chapter 3 Operational 57

Duplicate Payment Avoidance 57

Paying When the Original Invoice Is Missing 61

Limiting Calls to Accounts Payable 63

Petty Cash 65

Supplier Statements 69

Case Study: Expert Demonstrates How to Put the Web to Work for Accounts Payable 71

Chapter 4 Master Vendor File 77

Master Vendor File Setup 77

Using Naming Conventions 81

Making Changes to the Master Vendor File 85

Master Vendor File Cleanup 87

Case Study: Experienced Accounts Payable Pro Shares Master Vendor File Control Secrets 90

Chapter 5 P-Cards 97

Design of the P-Card Program 97

Establishing Procedures 99

Setting Controls 101

Increasing Usage 105

1099s and P-Cards 106

Terms 108

Rebates 110

Case Study: P-Cards Improve Accounts Payable Process at PETsMART, Rock-Tenn, and Rouse 111

Chapter 6 Travel and Entertainment 119

Formal Policy 119

Cash Advances 123

T&E Report Form 125

Verifying Data 127

Handling Receipts 129

Reservations 130

Reimbursing Employees 132

Unused Tickets 133

Case Study: Making the Most of Direct Deposit 134

Case Study: TransUnion’s Successful Low-Tech, Low-Budget T&E Solution 136

Case Study: Follow IBM’s Lead: 21 Steps to an Award-Winning T&E Process 139

Case Study: How Zurich America Developed Its Own Electronic T&E Report 145

Chapter 7 Regulatory Issues 151

1099s 151

Sales and Use Tax 154

Unclaimed Property 156

Case Study: How to Avoid Sales and Use Tax Audit Disasters 159

Case Study: A Typical Company’s Unclaimed Property Experience 162

Chapter 8 Cash Management 167

Taking Early Payment Discounts 167

Payment Status Information for Vendors 170

Bank Accounts and Fraud 172

Other Cash Management–Related Initiatives 174

Case Study: General Electric’s Approach to Electronic Invoicing and Payment Processing 176

Chapter 9 Technology 181

Imaging and Workflow 181

The Internet 185

E-Invoicing 187

Case Study: PPL Electric Offers Lessons on Setting Up an Accounts Payable Imaging Solution 189

Case Study: An Accounts Payable Web Site 194

Case Study: How the Accounts Payable Manager at Merck Overhauled Department Procedures and Technology 199

Chapter 10 Communications/Customer Relations 209

Payment Status Information for Vendors 209

Communicating Relevant Information to Vendors 211

Communicating with Internal Customers 214

Improving the Procure-to-Pay Cycle 217

Case Study: Interactive Voice Response Frees Accounts Payable from Annoying “Where’s My Money” Calls 219

Case Study: How Automated Accounts Payable and Purchasing Systems Mesh at BNSF 222

Index 229