Every business has bills to pay, and the person in charge of accounts payable is the one who is responsible for getting those bills paid. In a larger business, or where there is a high volume of bills to be paid, there may be a person, or even a whole department dedicated entirely to accounts payable. In a smaller business, or in an environment where the volume of bills to be paid does not justify a full-time person, the accounts payable function may be combined with other administrative duties, such as accounts receivable, payroll, and bookkeeping.�
What Does The Person In Charge Of Accounts Payable Do?�
Whether accounts payable is a full-time job or part of a position involving different administrative responsibilities, the functions and duties related to accounts payable are the same. The person in charge of accounts payable is responsible for ensuring that properly authorized business obligations, that are appropriately reviewed, verified and supported, are paid in a timely manner.
The accounts payable (A/P) person will receive invoices from vendors, compare these invoices with purchase orders and contracts, verify prices, quantities and terms, and obtain the necessary approvals. The accounts payable function generally includes the scheduling of payments, once the process of verification and documentation has been completed. This could involve either the issuance of checks or the scheduling of bank transfers, depending on the cash disbursement system the business uses.
Some of the typical duties of the A/P person include:
� Maintaining files of outstanding purchase orders and work requests.
� Maintaining files of receiving reports for materials and supplies and completed work requests.
� Maintaining a contracts log.
� Keeping a commitments register.
� Receiving invoices from vendors.
� Matching invoices with purchase orders and receiving documents.
� Obtaining approvals for the payment of invoices and other business obligations.
� Coding invoices and other documents with the appropriate general ledger account and department or cost center number
� Entering invoices into the accounts payable system.
� Keeping files of invoices pending payment.
� Generating checks in payment of obligations that are properly supported and approved for payment, on their due dates.
� Maintaining files of paid invoices.
� Reconciling statements from vendors to vendor accounts on the accounts payable subledger.
� Generating 1099 forms and other required reports.
� Maintaining vendor master file information in the accounts payable system.�
What Is The Working Environment Like?
The accounts payable function is an administrative position with normal office working conditions and schedule. In a larger business the person in charge of accounts payable may be a member of the accounting department, reporting to the controller or to a senior-level accountant. In a smaller business, accounts payable may be one of several responsibilities in a multi-task administrative position.
The A/P person generally works with a considerable degree of autonomy and self-initiative. While this is generally a position with a direct supervisor, there is an important level of responsibility involved. The A/P person works with information, documents, and computer systems. And, there is a level of interaction with other levels in the organization and with other departments, as well as direct contact with vendors. Depending on the degree of segregation of duties and functions in the business, the accounts payable function may either include the purchasing function or be in close coordination. The A/P person therefore spends a significant amount of time working alone, but also has an important teamwork role and is responsible for coordinating internal control work with other members of the organization.�
What Are The Requirements?
An accounting degree is generally not required to work in accounts payable, but some knowledge of accounting principles and practices is very helpful, and often a person working in accounts payable is either a degreed accountant or is pursuing an accounting degree. The accounts payable function can be considered an entry-level position in accounting, with a period of training. But many times, the person in charge of accounts payable is someone with strong administrative abilities and knowledge of the business and organization, who makes a career of accounts payable, without necessarily having an accounting degree.
From the business’s standpoint, it is important to have a responsible, trustworthy and competent person in the accounts payable position. The A/P function involves comparing and matching data, filing documents, and meeting deadlines, while following established procedures and enforcing internal controls. The person in charge of accounts payable must therefore be organized and detail-oriented, with a good knowledge of internal control procedures, especially as they are practiced in the particular organization, and must be familiar with business documents such as quotations, bids, proposals, purchase orders, requisitions, receiving reports, invoices, progress payments, and contracts.�
What Are The Opportunities and Career Possibilities?�
There is always a need for qualified accounts payable workers. Every business has bills to pay, and whether accounts payable is a stand-alone function or is combined into a multi-task position, a person with accounts payable skills will always be in demand. Economic growth and expansion will only increase this need.
Accounts payable may be considered a starting point for a career in accounting, finance, administration or management, or may be considered a career in itself. Experience in accounts payable, combined with a degree in business administration, accounting, or finance, can open up opportunities for higher level positions.
Due to its close relationship with the purchasing function, experience in accounts payable can also lead to other career opportunities in the purchasing area. While knowledge of a particular business, and the interpersonal relationships developed within a company, not to mention the trust and confidence earned in carrying out the accounts payable function over a period of time are all certainly very valuable aspects, the generic nature of many of the accounts payable functions allow a person with A/P experience to cross over to different businesses and industries, thereby affording a higher level of flexibility and opening up more opportunities.
Reference:
- PayScale – Salary Survey: www.payscale.com U.S. Department of Labor – Bureau of Labor Statistics – Occupational Outlook Handbook: www.bls.gov
