Regardless of the size of an organization, it will always have its share of accounts payable. Accounts payable refer to the liabilities, bills, expenses, debts or the amount of money payable by the company to other financial institutions, service providers or companies. While an organization is in active operation, you cannot do away with payable accounts to other institutions. To manage your accounts payable, here are some ideas:
Simplify the process
Make the accounts payable process as simple and as complicated as possible. As much as possible, minimize the number of check runs per month. Come up with cash disbursement ceilings for every check so that the accounts payable department would prioritize the important invoices to pay for the period. One way to manage accounts payable is to delay payments to vendors with higher tolerance on delayed payments or you can opt for partial payments for large payables.
Make use of available technology
To make the process efficient and error-free, make use of available technology to avoid costly errors such as paying incorrect amounts, placing incorrect details on checks for paying vendors or paying accounts payable earlier or later than scheduled. To avoid such errors, make use of software or accounts payable that will allow for smooth facilitation of your payable accounts. Make sure that your module or software is properly installed for transactions to flow accurately.
Reduce fraud risks
Another way to manage accounts payable is to ensure that the system is risk free. Companies are susceptible to fraud especially on areas or departments that handle cash or checks whether outgoing or incoming. Make sure that there are different individuals involved in the process of cash or check disbursement and that there is clear separation of duties and the release of checks are not approved by single person alone.