[Webinar] Year End in Accounts Payable: Getting Rid of Some of the Stress

Year End in Accounts Payable:

Getting Rid of Some of the Stress

Mary Schaeffer

Publisher & Editorial Director AP Now

Author The Controllers’ & CFOs’ Guide to

Accounts Payable + 15 other business books

Agenda

Background

The Headaches

The Process

Your People

The Big Picture

Some solutions that address multiple

“issues”

Closing Thoughts

© 2012 Accounts Payable Now & Tomorrow and

Mary S. Schaeffer 2

Introduction

Year End

Financial close and extra work

Holiday celebrations

Employees shopping

Employees want time off

Budget has usually been completed

Recipe for tension, trauma and disaster


Mary S. Schaeffer 3

The Process


Mary S. Schaeffer 4

Accruals

As low as possible

Always an estimate

Who does them

AP

Departments

Accounting

How to avoid double counting


Mary S. Schaeffer 5

Discrepant Invoices

Should be included in accruals if not paid

But for how much???

Push to get them resolved

Remember, vendors are probably cleaning up their AR

Receptive

Some will use outstanding credits to cover


Mary S. Schaeffer 6

Outstanding Invoices

If invoices not received first in AP or an automated system

used, this can be a huge problem

Invoices come out of the woodwork

More volume

What’s awaiting approval?

What are your processors holding that hasn’t been entered?

How are your worst performers stacking up

After year end, go through the numbers and see which of

your processors put through an inordinate number of

invoices and find out why


Mary S. Schaeffer 7

Outstanding Expense Reports

Everyone’s favorite

Last minute – 6-12 months of expense reports

Remember IRS guidelines for accountable plan

Keep a list for next year

Set a policy

Talk to the laggards’ supervisors

Remind them early next year


Mary S. Schaeffer 8

The Last Check Run

Do you have everything?

Are you printing some checks but not mailing them???

Will you have a second “last” check run?

Do you hold items for the following year?

When are you printing?

Did you leave enough time to stuffing and adding backup – if

you do that?

Did you leave enough time to get a manual signature, if that is

required?


Mary S. Schaeffer 9

Last Check Run: Partial Solution

Two check runs

One for the mail

Other for special handling

Of course, many of these problems avoided with

ACH


Mary S. Schaeffer 10

Vendors Who Didn’t Get Paid

Vendor needs payment on books by year end

Check really is lost in the mail

Mad dash to

Put a stop payment on the first payment

Issue a new check

Possibly even overnight the item

Pay electronically



Cut-off Dates Earlier than in non-close months

Last minute rushes – there will be many!

Despite all your efforts to publicize, a few will still show up on the standard cut-off date

Publicize – far in advance

Start in October, and REPEAT

Send to anyone who might be affected

Unofficially keep the books open an extra day

If this begins known, some won’t take the published cut-off as real



The Calendar

List everything on it

Task

Due date

Parties responsible

When they were notified

When task was completed

Track who did what when

Note any problems

Save for next year, review and adjust



The People Issues



The Fight for Time off:

Staff Vacation Time

The real kick: the plant is closed but accounting

has to come in

Extra work with several vacation days but

People want time to spend with family so

Solomon’s Call: Who gets the time off

Who puts in for it first

Seniority

Who’s got time left



Staff Vacation Time:

Some Partial Solutions

Plan far ahead of time … possibly even at the beginning of

the year

Share – Thanksgiving, Christmas, Easter week, 4th of July

week, Fridays in the summer etc.

Keep track from year to year

But don’t let critical tasks slide

Remember ACH fraud and the 24 hour bank notification period



The Mandatory Overtime Battle

It happens

Part of being considered a professional

Sometimes makes for a grumpy staff

Pizza lunches/dinners; bagels; donuts

Build camaraderie



The Big Picture Issues



The Use It or Lose It Dilemma Budget

Improve morale

Small bonuses – a long shot

Artwork

Lunch – staff appreciation

Educational initiatives

Vacation time

Know the company policy

Track it and update employees –early in the game

Carry over for one-three months © 2012 Accounts Payable Now & Tomorrow and


The Last Mile: Collecting 1099

Information at the Last Minute

TIN Matching

Waiting until year end to verify

Only slightly better than not using

Still have to track down

Use TIN Matching – before first payment is made



Window Dressing: Financial

Statements

Making the balance sheet and income

statement look good

What AP can do:

Recover unclaimed property – if currently

reporting

Reclaim open credit from vendors

Duplicate payments – beef up your routines



Solutions: To Fix Multiple Problems



Solution #1: Get Rid of the Paper

Inefficient

Gets lost and damaged

In the mail

In your company

No audit trail



Solution #2: Utilize Best Practices

Eliminates some of the problems

Missing TIN

Getting expense reports on time

Sets the stage for use of best practices through the close



Communicate, Communicate,

Communicate

With all affected parties

Don’t rely on managers to share information

Early and often

Send reminders



Set Reasonable Expectations

Both with your boss and your staff

Days off, overtime etc.

Don’t be persuaded to agree to unrealistic

deadlines

You’ll probably fail

You’ll increase the stress level

Under promise, over deliver



Track Problems

Create a notes section on your calendar Who

What

Why

How could it have been avoided

Make notes – you won’t remember next year



Pay Electronically

Cost effective

Payment timing

All rush payments electronic

Less stress

Payments can’t get lost



E-Invoicing

Everyone has access to the information almost

simultaneously

Ends the finger pointing

Electronic audit trail

Easily resent or shared

Third party or email



Automate the Entire Accounts

Payable Process

Eliminates many of the issues

Okay – not the time off issue

Removes the stress−all year round

Consider it for next year

Put getting a demo at the top of your To-

Do list for next year © 2012 Accounts Payable Now & Tomorrow and


Where to Get a Demo

Ask Anybill

Email: [email protected]

Call: 877-426-9245



Thank you/Questions

Questions always welcome.

To share your thoughts and insights

Mary Schaeffer

[email protected]

302 836 0540

Sign up for our free weekly ezine at

www.ap-now.com/ezinesignup.html



mailto:[email protected]



http://www.ap-now.com/ezinesignup.html



About Mary Schaeffer

Mary Schaeffer is a nationally recognized accounts payable expert. Following a career in finance she turned to writing and consulting. For the last 15 years she has been researching and writing newsletters for the accounts payable profession. Currently she is the Editorial Director & Publisher of Accounts Payable Now & Tomorrow, (www.ap-now.com) a fee-based newsletter published by CRYSTALLUS, Inc.

She also handles most of the firms consulting assignments (focused primarily on AP issues) often working with other well-regarded professionals. Her blog, at http://ap-now.com/blog/ is read by over 15,000 professionals each month.

Ms. Schaeffer is the author of over 15 business books including The CFO and Controllers’ Guide to Accounts Payable and the recently published Fraud in Accounts Payable: How to Prevent It. John Wiley & Sons is the publisher of most of her books.

She also is a regular contributor to the AICPA’s Corporate Finance Insider.

Ms. Schaeffer has a BS in Math from York College (CUNY) and a MBA in Finance from New York University.

She can be reached at [email protected]



http://www.ap-now.com/



http://ap-now.com/blog/








Documents

[Webinar] Year End in Accounts Payable: Getting Rid of Some of the Stress