 Accounts Payable- Invoice Processing

 Vendor management
The term vendor management is used when describing the activities included in
researching and sourcing vendors, obtaining quotes with pricing, capabilities,
turnaround times, and quality of work, negotiating contracts, managing relationships,
assigning jobs, evaluating performance, and ensuring payments are made.
o The first is the establishment of the business goals mentioned above. It’s much
easier to select and manage vendors when you have clearly defined performance
parameters to compare and contrast.
o The second part of the process is to select the best vendors that will be able to
match your company’s performance characteristics. 
o Third is managing your suppliers. On a daily basis, your vendor managers will
need to monitor performance and output, ensure contract terms are being
followed, approve or disapprove changes, provide feedback, and develop
relationships
o the fourth aspect of vendor management is meeting your goals on a consistent
basis. 
 PO and Non-PO
o A PO invoice should include the purchase order number and details of the goods
or services provided as agreed between the buyer and supplier. Arriving at
accounts payable, the PO invoice will be matched against the purchase order to
ensure all details correspond.
o Non-PO invoices do not have a purchase order associated and are the result of
spend outside a regulated procurement process. This type of invoice is often
called expense invoice and is used for various indirect purchases. 
 Bank reconciliations
o A bank reconciliation statement summarizes banking and business activity,
reconciling an entity’s bank account with its financial records.
 o Bank reconciliation statements confirm that payments have been processed and
cash collections have been deposited into a bank account.
o All fees charged on an account by a bank must be accounted for on a
reconciliation statement.
 A treasury management system (TMS) is a software application which automates the
process of managing a company's financial operations. It helps companies to manage
their financial activities, such as cash flow, assets and investments, automatically. A TMS
is commonly used to maintain financial security and minimize reputational risk. It can be
used by a company's internal management, and may be purchased from a technical
supplier.
 Payment run: ACH, WIRE, EFT, CHQ, BACS
o EFT stands for Electronic Funds Transfer, and it refers to any payment from one bank
account to another that’s made electronically. EFT encompass:
o credit and debit card payments
o direct deposit payments
o many payments via online banking
o most wire transfers
o other methods

ACH transfers are a type of electronic transfers (EFT) designed for relatively small payments,
perhaps made regularly - direct debits and direct deposits. Both are done with ACH
transfers. The main practical difference between ACH payments and wire transfers is that
banks process ACH payments in batch, rather than individually. Which means they generally
take longer. However, they also cost a lot less. So if you’re not in a rush, an ACH payment
might be a good option.
o Domestic wire transfers are time-honored ways to get your money from one bank to
another, but banks often charge considerably for the service. And they can
sometimes be an inconvenience, with many American banks not offering wire
transfers online. 
 Line of credit
o A line of credit (LOC) is a preset borrowing limit that can be used at any time. The
borrower can take money out as needed until the limit is reached, and as money
is repaid, it can be borrowed again in the case of an open line of credit.
o Unlike a closed-end credit account, a line of credit is an open-end credit account,
which allows borrowers to spend the money, repay it, and spend it again in a
never-ending cycle.
o While a credit line’s main advantage is flexibility, potential downsides include
high-interest rates, severe penalties for late payments, and the potential to
overspend.
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