Account assignment and accounting transaction of incoming invoices
Another to-do in accounts payable is the account assignment and accounting transaction of incoming invoices. The accounts payable clerk thus creates a posting record that addresses both the vendor account and the associated expense account. If your accounting department uses a software, it can already provide suggestions for the transaction account. The account then only needs to be finally checked, which ultimately saves time.
Management of open items
A central task of accounts payable is to always keep an eye on the cash flow and liquidity of the company. This includes positively influencing these very components through strategic invoice management. When managing open invoices, it is therefore not only important to avoid fines for late payments, but also to be able to use discounts effectively. Normally, suppliers offer a discount of 1 to 3 percent if the invoice is paid within a certain period. This is usually between 5 and 14 days.
Clarifying questions about the invoice
Certainly, questions can arise about an incoming invoice, whether regarding the amount or the justification of the order in general. Using an accounting software can minimize the workload here as well. With finway, for example, the accounting department can follow up directly with the colleague in question via a comment function. In this way, questions or problems with the invoice can be clarified promptly without wasting valuable time. At the same time, all agreements regarding an invoice are documented in the system in an unchangeable manner.
Approval, payment and archiving of incoming invoices
As soon as the incoming invoices have been checked and any queries clarified, they can be approved for payment. If the accounting department works with a software, this approval is usually just a click away. With finway, you can connect a bank account through which the incoming invoices can be paid directly. Afterwards, the invoice must be archived professionally and in accordance with GoBD guidelines (principles for properly maintaining, keeping and storing books, records and documents in electronic form and for data access, as provided by the German tax authorities), for example in case of a tax audit – the legislator specifies a retention period of 10 years in Germany.
Master data maintenance
As already mentioned, each vendor is given its own identification number so that suppliers can be clearly assigned at any time. This also includes master data such as the VAT identification number (VAT ID) of the vendors, as well as delivery and invoice addresses. All of this data must be regularly maintained by the accounting department to ensure that everything runs smoothly during invoice processing. If your accounts payable department uses a software such as finway, notes or recommendations can be stored in the supplier list in addition to essential information such as addresses and the usual cost center and G/L account.