Notes on Accounts Payable:

Two major decisions made by A/P:

  1. Deciding what to pay if you donít have enough money to pay everything
  2. Check if invoice should be paid (Could be done by purchasing)

Flow of paper:

General flow:



(could be sent to purchasing for validation and then to A/P)

Accounts Payable:


Input to Confirmation Stage:

Output from Confirmation Stage:

Input to Payment Stage:

Output from Payment Stage:

Payment stage involved decisions on who is to be paid. Usually start out with money you have to pay bills and list of invoices to be paid. Decision instructions given to choose most advantageous use of money available (consider discounts, payment terms, credit status, age of bill etc.) Interactive process with management looking at different alternatives - some suggestions being rejected and others being forced. Results in invoices to be paid and invoices to be held.

NOTE: We are only looking at paying for merchandise. There is another whole side of this - payment for expenses to run company such as utilities, supplies etc.

Notes on computerized overview:

Things to watch out for: