Mary Schaeffer has just released her newest book covering all things AP. With this new book entitled 101 Best Practices for Accounts Payable Mary keeps up with her tradition of providing great information and great value for the reader.
The book contains 22 chapters that cover a wide variety of topics that span from the initial setup of a department to the automation of its parts. It is clear after reading the book that Mary is a special resource for our community.
I had a chance to speak with Mary after I received the book and she informed me that she has converted the book into coursework that when tested on will suffice to provide APE credits.
Personally I liked how Mary is able to articulate both the “Best” practices that we should strive for as well as the “Worst” practices we should watch out for.
The book is a great read and is an even better value.
Click HERE for a direct link to buy the book from Mary.
Here is an excerpt from her book
Issue: Who Has Access to the Master Vendor File
While it is definitely easier for the staff processing invoices for payment if they can add vendors to the master vendor file whenever they get an invoice from a new vendor that practice is an invitation to trouble. Unfortunately, that’s how a number of organizations handle information into the master vendor file. This means giving access to the master vendor file to a large number of individuals. This is a terrible idea. It completely disregards the best practice concept inherent in all accounting functions of having appropriate segregation of duties.
Best Practice: Access to the master vendor file, for anything but information lookup, should be severely limited. Only a few people should be able to enter information, be it for setup or to make changes. The employees with this access should not perform any other tasks in the procure-to-pay function making it more difficult for someone to defraud the organization. What’s more, when they go on vacation, their passwords and access should not be given to someone else. This will simply muddy the audit trail should there be a problem down the line. A better approach is to set the back-up person up with their own user ID and password and then deactivate those when the person with primary responsibility for the task returns. This is less of a problem in large organizations where there will be several people working on the master vendor file.
Almost Best Practice: This is a black and white issue so there really is no almost best practice. In many organizations there is one or two people with access to the entire accounts payable function. Typically this is the manager, director or perhaps the Controller. While this is not a good idea, it does solve the problem of an unexpected absence, assuming the person with the broad access is willing to dive in and handle the task. Really, though, unlimited access is not a good idea.
Pointer for Accounts Payable: While limiting access for the purposes of adding new vendors or updating information on existing vendors can seem to make the accounts payable function run less smoothly, it is imperative from an internal control standpoint. Sometimes what is easier for accounts payable is not necessarily good for the organization as a whole and this is one of those instances.
Worst Practices:
Letting each processor update information about their own vendors
Letting each processor add vendors whenever it seems necessary
