Accounts Payable

-going paperlessAn overview of the accounts payable process

and converting to a paperless system

WPTA Conference, April 13th, 2017

Philip Steffen

Outline

�Records retention requirements

�Scanning Process

�Electronic payments

� Internal Controls

�Purchase Cards

City of Anacortes’ Story

� Motivated to have electronic access

� Internal use

� Auditor use

� System configuration

� Departmental implementation

� Meetings

� Instructions

� Equipment

Records Retention Compliance

� WA state requires 300dpi for some documents, recommended for all

� Lossless format required for documents with longer than 6 year retention schedule

� Lossless PDF Information

�http://www.prepressure.com/pdf/basics/compression

� RCW 65.24.101

� (3) "Electronic document" means a document that is received by the recording officer in an electronic form.

� WAC 434-663-305

� Scanning density

WA State Archives, Scan & Toss

� Only Non-Archival records are eligible

� Documents that can be destroyed at some point

� Complete and Accurate copies

� Quality Control procedures implemented

� Chocolate cake smudge? Keep the original

� Images must be accessible and protected

� Maintain ability to view records and file formats

� Backup of data

� Scan and Toss information from WA State Archives� https://www.sos.wa.gov/archives/RecordsManagement/scanning-and-tossing-records.aspx

Scan & Toss

� Use a simple test before tossing documents

� If you answered YES to each of the three items on the

Checklist the original record(s) can be recycled.

Scanning Process

� Review current entity process

� Discuss with departments and personnel involved

� Establish procedures

� Records retention in mind

� Implement

� Know there will be adjustments to the process you thought was

best

� Equipment

� Large and small scanners

Brother ADS-1500W

Large printer

Scanner Equipment

� OCR Capable

� Speed

� Input of file name prior to scanning

� Duplex scanning

Electronic Invoices

�Get invoices directly from vendors

�Sign up for online statements

�One email

�Multiple emails

Electronic Payments

� ACH

� The money is pulled from entity account

� The money is pushed to the vendor account

� Benefits

� No need to mail checks

� Money is cleared (no stale dated checks in the future)

� Faster for vendor to receive funds

� Drawbacks

� Liability of having vendors bank information

Electronic Payments Security

� Setting up a Vendor

� Tightly Control and coordinate the entire process

� Obtain proper documentation

�Written authorization is required in order to receive

ACH payments

� Verify user at the vendor site is authorized

� Verify the bank information given

�For example, an individual at the vendor site might

give personal bank information

� Encrypted communication

Electronic Payments Security

� Create and maintain a secure computer environment

� Limit the use of online banking transactions to specific computers

� Require multiple layers of password security

� Actual payment process

� Dual control

� Extra bank control

� Token Identification

� Registered Computers

� Specific times

Source: 2016 AFP Payments Fraud Report

Internal Controls Process

� Development of user profiles, which enforce separation of duties

� Multiple approval processes should occur before disbursement of funds

� Dollar limitations

� Timely review of exceptions

� Frequent monitoring of cleared banking transactions to catch unauthorized

transactions

Worth It

� Paying vendors via ACH and EFT can be a tremendous cost saving benefit for a

nonprofit organization. The key to a successful EFT and ACH process is to

make sure the proper controls are in place from start to finish. Protect your

organization from being a victim of fraud.

Purchase Cards

� US Bank provides purchase cards

� Transactions are downloaded into accounting system

� Automatically paid via ACH to US Bank

Questions and Discussion

Contact

� Philip Steffen

� City of Anacortes – Uses Tyler Technologies Eden software

� steffenp@cityofanacortes.org

� 360-293-1903