[Webinar] Year End in AP: Getting Rid of Some of the Stress Presented By: AP Now and Tomorrow

Year End in Accounts Payable: Getting Rid of

Some of the Stress

Mary SchaefferPublisher & Editorial Director AP NowAuthor The Controllers’ & CFOs’ Guide to Accounts Payable + 15 other business books

Agenda

BackgroundThe Headaches

The ProcessYour PeopleThe Big Picture

Some solutions that address multiple “issues”

Closing Thoughts

© 2012 Accounts Payable Now & Tomorrow and Mary S. Schaeffer2

IntroductionYear End

Financial close and extra workHoliday celebrationsEmployees shopping Employees want time off

Budget has usually been completedRecipe for tension, trauma and disaster


The Process


Accruals

As low as possibleAlways an estimate

Who does themAPDepartmentsAccounting

How to avoid double counting


Discrepant InvoicesShould be included in accruals if not

paidBut for how much???

Push to get them resolvedRemember, vendors are probably

cleaning up their ARReceptive Some will use outstanding credits to

cover


Outstanding InvoicesIf invoices not received first in AP or an

automated system used, this can be a huge problem

Invoices come out of the woodworkMore 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


Outstanding Expense ReportsEveryone’s favorite

Last minute – 6-12 months of expense reportsRemember IRS guidelines for accountable

plan

Keep a list for next yearSet a policyTalk to the laggards’ supervisorsRemind them early next year


The Last Check RunDo 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?© 2012 Accounts Payable Now & Tomorrow and Mary S. Schaeffer9

Last Check Run: Partial Solution

Two check runsOne for the mailOther for special handling

Of course, many of these problems avoided with ACH


Vendors Who Didn’t Get PaidVendor needs payment on books by year

endCheck really is lost in the mailMad dash to

Put a stop payment on the first payment

Issue a new checkPossibly even overnight the item

Pay electronically© 2012 Accounts Payable Now & Tomorrow and Mary S. Schaeffer11

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© 2012 Accounts Payable Now & Tomorrow and Mary S. Schaeffer12

The CalendarList everything on it

TaskDue date Parties responsibleWhen they were notified When task was completed

Track who did what whenNote any problemsSave for next year, review and adjust © 2012 Accounts Payable Now & Tomorrow and Mary S. Schaeffer13

The People Issues


The Fight for Time off: Staff Vacation TimeThe 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 offWho puts in for it firstSeniority 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 slideRemember ACH fraud and the 24 hour bank

notification period© 2012 Accounts Payable Now & Tomorrow and Mary S. Schaeffer16

The Mandatory Overtime Battle

It happensPart of being considered a professional

Sometimes makes for a grumpy staffPizza lunches/dinners; bagels; donuts Build camaraderie


The Big Picture Issues


The Use It or Lose It Dilemma Budget

Improve morale Small bonuses – a long shotArtwork Lunch – staff appreciationEducational initiatives

Vacation timeKnow the company policyTrack it and update employees –early in the game

Carry over for one-three months


The Last Mile: Collecting 1099 Information at the Last MinuteTIN MatchingWaiting until year end to verifyOnly slightly better than not usingStill have to track down

Use TIN Matching – before first payment is made


Window Dressing: Financial StatementsMaking the balance sheet and income statement look good

What AP can do:Recover unclaimed property – if currently reporting

Reclaim open credit from vendorsDuplicate payments – beef up your routines


Solutions: To Fix Multiple Problems


Solution #1: Get Rid of the Paper

InefficientGets lost and damaged

In the mailIn your company

No audit trail


Solution #2: Utilize Best Practices

Eliminates some of the problemsMissing TINGetting expense reports on time

Sets the stage for use of best practices through the close


Communicate, Communicate, Communicate

With all affected partiesDon’t rely on managers to share

informationEarly and oftenSend reminders


Set Reasonable ExpectationsBoth with your boss and your staff

Days off, overtime etc.Don’t be persuaded to agree to

unrealistic deadlinesYou’ll probably failYou’ll increase the stress level

Under promise, over deliver


Track Problems Create a notes section on your

calendar WhoWhat Why

How could it have been avoidedMake notes – you won’t remember next year


Pay Electronically

Cost effectivePayment timingAll rush payments electronic

Less stress Payments can’t get lost


E-Invoicing

Everyone has access to the information almost simultaneouslyEnds the finger pointingElectronic 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 yearPut getting a demo at the top of your To-Do list for next year


Where to Get a DemoAsk Anybill

Email: [email protected]: 877-426-9245


Thank you/Questions

Questions always welcome.To share your thoughts and insights

Mary [email protected]

302 836 0540

Sign up for our free weekly ezine atwww.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]



Economy & Finance

[Webinar] Year End in AP: Getting Rid of Some of the Stress Presented By: AP Now and Tomorrow