What are the Advantages to Outsourcing Accounts Payable?

Making sure your accounts payable are up to date can be very time-consuming even if you’re able to hire someone who is experienced in managing accounts payable. Outsourcing your accounts payable is often the best solution for a small business. 

Typically, these are the tasks required to properly manage your accounts payable:

• Verifying entries in your bookkeeping system and comparing system reports to balances
• Keeping track of spending and payments, including payroll, bills, statements, purchase orders, and more.
• Verifying expense reports and payroll to accurately prepare paychecks for employees.
• Maintaining accurate records of all accounts payable.
• Paying vendors and making sure payment is received. This also includes creating payment schedules for vendors and responding to vendor inquiries. Another important part of paying vendors is obtaining vendor discounts and avoiding penalties or interest for late payments.
• Preparing monthly, quarterly, and annual reports for internal reviews
• Analyzing cash flow and finding ways to improve payment processes, including optimizing the management of your working capital.

At Bookkeeping Unlimited, we believe properly managed accounts payable and accounts receivable are a goldmine for business owners. Unlike outsourced bookkeeping software or other bookkeeping solutions, our team of bookkeeping experts is dedicated to the financial health of your business. That includes conducting quarterly and annual reviews of your books and providing you with reports to help you make informed decisions about your business’ cash flow. 

Why Every Company Needs to Build Internal Controls  & Compliance into Your Accounts Payable System.

We work with you to develop internal controls within your accounts payable system so that not only are your assets safe, you aren’t disrupted because of a duplicate payment, an incorrect bill, fraudulent charges, and other bookkeeping matters. Internal controls are rules and processes we set up with you so that we are given certain, specific permissions and authorities to protect your assets and liabilities. Part of setting up internal controls is determining how and when you’d be notified if an internal control process has to be implemented. 

Effective internal control processes for accounts payable includes making sure your accounts payable system is always in compliance. Compliance for accounts payable is borne out by good, effective internal controls and a company-wide, top-down culture of integrity, honesty, and ethics. 

When we help you set up your internal controls and processes for your accounts payable system, we’ll help you separate duties, choose tools that will help you monitor systems access, and create workflows that help you delegate specific authorities to your team based on your company’s needs. In addition, we’ll review your vendors and suppliers to ensure there are no financial or compliance risks, to avoid potential fraud or payment errors, and to make certain there are no regulatory or tax compliance issues. 

We make sure compliance is woven into every part of your accounts payable system. Great internal controls processes and great compliance save you time, save you money, prevent fraud, and protect your assets. 

Ultimately, the goal of a well-managed accounts payable system is to give you greater clarity and understanding of your cash flow in order for you to have more control over what your business is spending money on and why. It enables you to focus on the financial health of your business instead of struggling to find time to do your accounts payable in your busy schedule. 

Gain Control Over Your Cash Flow Today. Outsource Your Accounts Payable to Bookkeeping Unlimited.

Whether you’re trying to maximize your cash flow, get better insight into your financials, trust your team, make sure your records are accurate, or simply gain more time every week, outsourcing your accounts payable to our team of specialists will help your business grow and succeed. 

When you sign up for our obligation-free bookkeeping consultation, we will review your books and current accounts payable processes to determine what solutions are best for you and your company. This consultation, valued at over $500, is being offered at no cost to business owners for a limited time.

Once we’ve conducted a thorough review of your financials and created a custom digital solution for your business, we review everything during a one-hour Zoom consultation. 

Get the tools and expertise you need to save money, spend more time growing your business, and improve your bottom line. Sign up for a FREE consultation today to get bookkeeping that works for you.

• Reduce the number of check runs; two per month at most is plenty.
• When the accounting staff prepares check runs, they should have the invoice backup ready and invoices approved by the appropriate department heads before coming to you for signatures.
• Make Accounts Payable aware of any cash disbursement ceilings for each check run so they can then select the most important invoices to pay.
• Empower your staff with decisions that will make your life easier and are not dangerous for them to make. The decision to make partial payments on larger balances, or delaying payments to vendors who have a higher tolerance on due dates are a couple of examples.

• Analyze and reduce errors such as paying incorrect amounts, incorrectly entering check numbers used to pay vendors, and paying too early or too late.
• Make sure your accounts payable module is set up correctly so that transactions flow properly. You may need to use a consultant to make sure your accounting software and accounts payable module are correctly configured, or you could cause more problems than you solve.
• Have Accounts Payable staff enter terms for each vendor in which the system can default to, such as Net 30, Net 60, etc. Terms are often provided by the vendor, and are usually printed on the face of their invoice.
• Run aging reports so you know what is in the pipeline.  You may have a small check run this period, but could have a large one coming up that you didn’t know about until looking at these reports.
• Use laser printed checks, which will update the system automatically, marking which invoices have been paid and with what check numbers.

• Anywhere cash/checks are handled (incoming or outgoing) can be a high-risk area for company fraud.
• In Accounts Payable, this is often accomplished by setting up a “dummy vendor”.  Often times, this vendor is a company owned by a dishonest employee. Invoices for services never provided are created, and your business pays these invoices, essentially paying the employee.
• Implement policies & procedures to mitigate the risk.  In the above example, have system parameters set so that the person cutting checks does not have the ability to set up new vendors. Each new vendor that is set up should require explanation to the owner prior to creating them.
• Separation of duties, proper approval by department heads, and spot checks will help reduce the risk of fraud.