Accounts Payable - End to End process of AP

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Accounts Payable | Question 91 of 143

End to End process of AP

Please explain end to end process of accounts payable. I mean, Invoice processing to Payment.

Total Answers and Comments: 5

Last Update: December 03, 2008 Asked by: js_chacko

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Submitted by: Sanju40148

End to end of accounts payable includes the various stages involved in making the payment of an invoice received from a vendor . The AP activities starts with the receipt of the invoice from the vendor and ends when it gets paid .The various stages in an AP process are listed below -

(a) Receipt of invoice
(b) Scanning the invoice and uploading it in workflow
(c) Processing the invoice in the system ( ERP)
(d) The posting going through QC - quality check.
(e) Resolving a parked invoice.
(f) Payment proposal - report of invoices falling due on the currect date.
(g) Payment run - here the invoice ultimately gets paid.

Above answer was rated as good by the following members:
Gandhevi, khushbu.mirza, bindhu3080

August 15, 2008 18:13:48

Sanju40148

Member Since: August 2008 Contribution: 3

RE: End to End process of AP

End to end of accounts payable includes the various stages involved in making the payment of an invoice received from a vendor . The AP activities starts with the receipt of the invoice from the vendor and ends when it gets paid .The various stages in an AP process are listed below -

(a) Receipt of invoice
(b) Scanning the invoice and uploading it in workflow
(c) Processing the invoice in the system ( ERP)
(d) The posting going through QC - quality check.
(e) Resolving a parked invoice.
(f) Payment proposal - report of invoices falling due on the currect date.
(g) Payment run - here the invoice ultimately gets paid.

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Overall Rating: +3

August 17, 2008 10:14:03

Gandhevi

Member Since: August 2008 Contribution: 6

RE: End to End process of AP

There is basic rule called Three way Match which says the invoice should match with Invoice Receipt-Goods Receipt-Invoice. If the above condition is fullfilled then the payment can be processed.

In this case the invoice will not get paid because PO is raised for 5000 and invoice is billed for 6000 which is around 20 more. Hence it will be blocked for payment and procurement team would touchbase with Vendor for the difference in deal. Upon vendors response procurement team would increase PO to 6000 and release the payment.

Regards Vinod.

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October 28, 2008 03:47:05

Gandhevi

Member Since: August 2008 Contribution: 6

RE: End to End process of AP

Hi Mahima

Accounts Payable process works as per your daily life... How?
When you go for shopping you will purchase goods by giving cash. Giving cash is nothing but you are making payment for what you have subscribed.

But when samething happens in industries they do huge business with several vendors and the business is ongoing process with the vendor hence companies will tied up with vendor on purchasing terms where they will make payments based on order.

So before making payment Accounts Payables dept need to review the billing details of the vendor and eradicate the duplicate payment to the vendor.

Please reply back to you with your doubts. Its very subjective I can walk you through it in detail.

Regards Vinod.

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October 28, 2008 03:49:34

Gandhevi

Member Since: August 2008 Contribution: 6

RE: End to End process of AP

A report would give the essence of Process. So whatever is happening in the Process it would be kept on a paper and submitted to the management as a Report based on that they will take decisions to sharpen the process.

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December 03, 2008 16:58:49

praveengold

Member Since: December 2008 Contribution: 1

RE: End to End process of AP

The AP activity starts from Invoice Processing and it gets completed once the invoice is paid. The flow of AP is as follows:

Once the vendor sends the invoice for the goods or services rendered the IP team verifies the three way match conept if its a PO or else two way match if its a No PO. Once the IP team process the invoice it goes through several verification process and once this is completed it will be free for payment.

Here the cash managment team will pick the invoice for payment and pay the vendor as per either though check EFT or Wire this depends as per the agreement b/w vendor and the buyer.

Thank you
Praveen

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