Organizations often deal with a continuous flood of supplier invoices and check requests from employees. There are demands to issue payments as expeditiously as possible, despite an offsetting need to investigate each request to ensure that it is valid. Payables Management describes a number of ways to create an efficient payables system that processes invoices at low cost, while still maintaining close control over the payments made. The course also covers an array of related topics, including procurement cards, use taxes, closing the books, payables controls, unclaimed property, and more.
You can find the answers to many questions about payables in the following chapters, including:
- Which alternatives are available for processing invoices?
- How can I make the review of expense reports more efficient?
- What process flow is needed to generate a use tax liability?
- How can I calculate the interest rate associated with an early payment discount?
- How can I minimize the amount of property that must be reported as unclaimed?
- What are some of the targets of a cost recovery effort?
Payables Management is designed primarily for professionals, who can use it as a reference tool for developing payables systems and researching the correct accounting to deal with various transactions. Given its complete coverage of these topics, Payables Management should earn a permanent place on your bookshelf.
Upon successful completion of this course, participants will be able to:
- Recognize the types of transaction cycles as well as the effects of the different organizational structures.
- Note the effects of the matching concept and the use of adjustment documents in invoice processing.
- Identify the types of payments, their advantages, and when they are used.
- Note the exclusions from expense reports.
- Recognize the steps used in the reconciliation of a procurement card statement.
- Identify the parties involved in remitting sales and use taxes.
- Identify the concepts under which supply chain financing is offered to suppliers.
- Note how accounting software applies information when an invoice is recorded.
- Note how accrued expenses are calculated.
- Identify the types of process improvements as well as the methods used to improve the layout of a department.
- Recognize the controls used for invoice processing, recurring payments, expense reports, procurement cards, and petty cash.
- Identify the types of fraud that can apply to payables.
- Cite the impacts and features of the different types of payables technology.
- Identify the fields used in the vendor master file, and the methods used to derive supplier identification numbers.
- Note the uses of the Form 1099 copies.
- Identify the fields used in the Form 1099.
- Note the situations in which backup withholding is not required.
- Recognize the rules under which unclaimed property is sent to the applicable state government.
- Note the processes related to unclaimed property.
- Note the areas in which cost recovery efforts can yield a significant return.
- Cite the situations in which certain payables measurements can yield incorrect or skewed results.
Table of Contents
Chapter 1 – Overview of Payables
Organizational Structure of the Accounting Department
Payables Job Descriptions
Chapter 1 – Review Questions
Chapter 2 – Invoice Processing
The Need for Precise Invoice Processing
The Supplier Invoice Processing Procedure (Manual System)
The Supplier Invoice Processing Procedure (Integrated System)
Accounts Payable Credits Processing Procedure
The Evaluated Receipts Processing Procedure
The Check Payment Issuance Procedure
The Void Checks Procedure
Enhancements to Invoice Processing
Direct Invoice Delivery
Centralize E-mailed Invoice Processing
Return Incomplete Invoices
Invoice Numbering Convention
Request Aggregated Invoice
Analyze Matching Discrepancies
Monitor Invoice Disputes
Automate Recurring Payments
Restrict Manual Checks
Analyze Manual Checks
Restrict Manual Delivery of Checks
Restrict Cash Advances
Schedule Frequent Check Runs
Use a Signature Stamp or Plate
Reduce the Need for Second Signatures
Encourage use of ACH
Clean the Payables Aging Report
Search for Open Credits
Reduce the Number of Suppliers
Chapter 2 – Review Questions
Chapter 3 – Types of Payments
Cash Payments (Petty Cash)
Foreign Check Clearing
Advantages of Checks
Disadvantages of Checks
Automated Clearing House Payments
Advantages of ACH
Impact on Float
The Letter of Credit
The Standby Letter of Credit
Chapter 3 – Review Questions
Chapter 4 – Expense Reimbursement
The Need for Expense Reimbursement
The Expense Report Submission Procedure (Manual System)
The On-Line Expense Report Submission Procedure
The Expense Report Review Procedure
The Travel and Entertainment Policy
Direct company payments
Additional Expense Reimbursement Topics
Form of Documentation
Expense Report Auditing
Expense Report Outsourcing
Chapter 4 – Review Questions
Chapter 5 – Procurement Cards
When and How to Use Procurement Cards
The Card Reconciliation Procedure
The Lost Card Procedure
Additional Procurement Card Topics
Card Issuer Relations
Cash Flow Management
Card User Relations
Departure of Card Users
Chapter 5 – Review Questions
Chapter 6 – Use Taxes
Sales and Use Tax Overview
Use Tax Systems
Use Tax Audits
Sales Tax Exemption Certificate
Multiple Points of Use Certificate
Chapter 6 – Review Questions
Chapter 7 – Finance Issues
Early Payment Discounts
Supply Chain Financing
Chapter 7 – Review Questions
Chapter 8 – Accounting for Payables
Routine Accounts Payable Entries
Period-end Accounts Payable Entries
Applicable Accounts to Charge
Chapter 8 – Review Questions
Chapter 9 – Closing Payables
Accounts Payable Accruals
Issues with the Credit Card Close
Accounts Payable Suspense Items
Reconciling Accounts Payable
Additional Year-end Tasks
Closing the Ledger
Chapter 9 – Review Questions
Chapter 10 – Department Management
Payables Manager Responsibilities
Schedule of Activities
Error Tracking System
Skills Review and Training
Measuring the Results of Training
Quality of the Work Environment
Flexible Work Hours
Permanent Part-Time Work
Chapter 10 – Review Questions
Chapter 11 –Payables Control
Accounts Payable Processing Controls
Alternative Accounts Payable Control Systems
Control System for Manual Accounts Payable
Control System for Computerized Accounts Payable
Additional Payables Controls – Trend Analysis
Additional Payables Controls – Fraud Related
Additional Payables Controls – Periodic Actions
Expense Report Processing Controls
Alternative Expense Report Control Systems
Control System for Manual Expense Reporting
Control System for Computerized Expense Reporting
Additional Expense Report Controls – Fraud Related
Additional Expense Report Controls – Periodic Actions
In-Process Procurement Card Controls
Alternative Procurement Card Control Systems
Procurement Card Control System without a Transaction Log
Procurement Card Control System with a Transaction Log
Additional Procurement Card Controls – Fraud Related
Additional Procurement Card Controls – Periodic Actions
Petty Cash Controls
Additional Petty Cash Controls – Fraud Related
Expense Report Policies
Procurement Card Policies
Petty Cash Policies
Chapter 11 – Review Questions
Chapter 12 –Payables Fraud
Refunds of Personal Purchases
Authorization Limit Avoidance
Petty Cash Theft
Chapter 12 – Review Questions
Chapter 13 – Payables Technology
The Payment Factory
Automated Expense Report Submissions
Automated Payables Matching
The Reverse Lockbox
Automated W-9 Forms
Chapter 13 – Review Questions
Chapter 14 – Payables Record Keeping
The Vendor Master File
Vendor Master File Usage
Supplier Naming Conventions
Vendor Master File Errors
Duplicate Record Detection and Prevention
The Payables Filing System
Chapter 14 – Review Questions
Chapter 15 – Government Reporting
The Form 1099-MISC
Treatment of Incorrect Filings
The Form W-9
Form 1099 Administrative Issues
Form W-9 Administrative Issues
Chapter 15 – Review Questions
Chapter 16 – Unclaimed Property
The Unclaimed Property Liability
Treatment of Credits
Due Diligence Letters
The Dormancy Period
The Unclaimed Property Audit
Document Retention Policy
Filing Unclaimed Property Reports
Claiming Unclaimed Property
Chapter 16 – Review Questions
Chapter 17 – Cost Recovery
Internal Cost Recovery Targets
Health Plan Enrollment
Internal Cost Recovery Staff
Cost-Benefit of Cost Recovery Activities
Cost Recovery Timing
Fertile Ground for Cost Recovery Efforts
Chapter 17 – Review Questions
Chapter 18 –Payables Measurements
Days Payables Outstanding
Supplier Billed Price Variance
Transaction Error Rate
Full-Time Equivalent Measurements
FTEs per $1 Million of Revenue
Staff Cost per FTE
Line Items per FTE
Percent of Paperless Invoices
Percent of Paperless Payments
Additional Payables Measurements
Chapter 18 – Review Questions
Review Question Answers and Rationales
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