Accounts Payable Process

1. Introduction:

This document sets out the procedures for the maintenance of accounts payable ledgers.

2. Purpose:

The purpose of this procedure is to standardise and maintain the company’s cash flow requirement as well as the effective establishment of debt.

3. References:

Accounts Payable Process Flowchart

4. Definitions:

4.1. Accounts Payable: Commonly known as Creditors, is a company and or an individual that has indebted financially, ITM P/L for services performed.

5. Procedure

5.1. Receive Invoice

Invoices that are received shall be given to either the Administration Manager or Accounts where determination will be made as to whether or not they are Job related.

5.2. Authorisation

Authorisation shall be given by a Senior Manager as to the validity of the debt incurred.

5.3. Process To General Ledger

The Invoice shall be processed via the Freightpac system to the General Ledger in as much as practicable within the correct accounting period.

5.4. Costs to Jobs

If the invoice is Job related it shall be approved by the Account manager. The Account manager shall ensure that the amount has or will be charged out against either a disbursement or final invoice to the client. 

5.5. Accounts Payable Ledger

The Administration Manager or Accountant shall print an Accounts Payable Ledger as often as required to ensure the management of monies owed by ITM.

5.6. Match Invoices

The Administration Manager / Accountant shall match the physical invoices to the Accounts Payable ledger to ensure their correctness before payment of such.

5.7. Draw Cheques

Cheques shall be drawn as often as required to ensure effective management of the Accounts Payable Ledger.

5.8. Signatories

The registered cheque signatories shall be responsible for verifying as much as practicable the indebtness.

5.9. Post Cheque

The cheque shall be separated from the Cheque Requisition and given to The Administration manager / Accountant. The Cheque along with the Remittance advice shall be placed in the mailing tray.

5.10. Process Cheque

The cheque requisition shall be entered into the Freightpac system against the Accounts Payable entry thus nullifying the debt.

5.11. File

The requisition shall be filed in the Cheque order whilst the Invoice can either be filled behind the requisition or alphabetically.

6. Documentation:

FN10.1 Cheque Requisition