Posting,
including posting invoices, auto-pay invoices, invoices from purchase order information, and credit memosUnderstanding the Flow of Accounts Payable
The Accounts Payable Flow
The accounts payable (A/P) flow includes the following steps.
Posting,
including posting invoices, auto-pay invoices, invoices from purchase order information, and credit memos
Adjusting
and correcting, including viewing invoice information, and adding or deleting explanatory messages
Paying
A/P invoices with either system-generated or hand-written checks, or posting partial payments
Marking,
viewing and printing invoices
Printing
and releasing A/P checks
Maintaining
the check file
Performing
period-ending procedures
Releasing,
purging, and aging A/P
Using
the accounts payable reports.
Before using accounts payable, set parameters in the following screens:
(LHN)
Payroll/Personnel Parameters screen
(L2)
G/L Master Numbers screen
(LC)
Vendor And A/P Parameters screen.
When you receive an invoice from a vendor, you must post the invoice. This means that you record the invoice in the Accounts Payable application.
You use batch numbers to post similar entries in the same group. For example, you can post all invoices in one batch, and all credit memos in another. Grouping your postings makes it easier to verify their accuracy. In addition, you can use the batch reports as an audit trail. For more information about batch numbers, see Understanding Accounts Payable Batches.
You can make adjustments and corrections to correct errors, change discounts on invoices or voided checks that have not been purged. You can view batch information to verify information. You can also add or delete explanatory messages.
You can pay an invoice when you post it, or you can pay the invoice later. To pay the invoice when you post it, you must either pay the entire invoice in full, or pay by hand-written check. However, if you post the invoice and then pay it later, you must pay the entire amount due on the invoice. You can also mark invoices to be paid, view invoices and print invoices.
You can maintain your A/P check file including, adding, changing, and deleting checks, through updating, viewing, and reindexing checks. You can also void purged checks.
Once your system-generated checks have been printed, and your hand-written checks have been entered, you release your checks. Remember that releasing checks must be done after you print the checks or enter hand-written checks. This process marks the invoice as paid and removes the invoices from the Accounts Payable Posting Payments tab. This process also updates your general ledger and allows the invoices to move to a journal at month-end. For details, see About Printing and Releasing Checks.
Releasing batches is done at the end of each business day. Purging, which deletes completed invoice entries, is done at the end of each month. Aging, which updates the age of each outstanding invoice, is also done at the end of each month. There are also year-end procedures for accounts payable.
At the end of the day, you print the A/P Batch Report, and release the A/P batches. This clears the day's batches from the AP-BATCH file. (Entries in the AP-MASTER file are not affected.) In addition, you use the President’s A/P Screen to audit the day's A/P activity.
See also:
Chart 1 - Following the Flow of Accounts Payable
Chart 2 - Paying Accounts Payable Invoices