Accounts Payable Procedures

August 15th, 2008 by Mary_Schaeffer

As I start to put together the material on the handling of paper invoices, I realize just how much accounts payable procedures are changing. Just a few short years ago, paying off a faxed invoice was a major league no-no. Paying only from an original invoice was considered a Best Practice.

Today, with the advent of inexpensive technology, you can have many ‘original invoices’ - and they all look good. So, that old chestnut no longer holds water.

Thanks to a question posed by a reader we’re examining the practices related to how invoices are received today and expect to have a White Paper available on this topic shortly.

I can only imagine what AP will look like ten years from now! If you’d like to share your thoughts on that issue, please write me at marys@ap-now.com or post your thoughts here. Registration is required to keep spam off the site.

© 2008 Mary Schaeffer and Accounts Payable Now & Tomorrow

A New Twist in the Unclaimed Property Debates

August 6th, 2008 by Mary_Schaeffer

Don’t let your assets disappear, says INGDicrect. The financial institutio is alerting all consumers to the issues surrounding Unclaimed Property and offering advice so the consumers property will not be considered abandoned by the states. What’s more it wants you to write a letter to your legislators to ” make them aware of how a law that was intended to protect consumers is doing just the opposite”

While this may be good news for consumers, it is not for the states - who will ultimately be forced to become even more aggressive in their pursuit of unclaimed property. Well - okay - not all the states will become more aggressive just the ones that rely heavily on that income.

Accounts Payable Now & Tomorrow has help for its readers grappling with Unclaimed Property issues. For information about its Unclaimed Property Toolkits, Seminars or webinars visit ap-now.com

Accounts Payable Jobs Now Included in AP Now ezine

August 5th, 2008 by Mary_Schaeffer

The question of whether or not to include accounts payable job listings in our free weekly ezine, e-AP News (sign up at http://ap-now.com/ezinesignup.html) is one that has been hotly debated here. My colleagues point out that most organizations save that content for paid subscribers. And, while I can see the logic in that from a business point of view, I also know that at the very point where someone needs to find a new job - perhaps because they’ve been laid off or are not getting along with management- is the time when funds are not likely to be available.

I won this battle and we will include a few job listings each week in our weekly ezine, along with my analysis of trends observed from reading the help wanted ads. As I think about it, this is the first time I ever got paid to read the help wanted ads … hmmm … is someone trying to tell me something??? Okay, I’m digressing and will get back to the point - or at least try to.

I also feel that in a tight economy we should do everything we can to keep as many of our readers employed as we can - and all we con do is bring them information. Which is why I am to read the ads and try and determine trends and identify skills in demand in the marketplace.

We also welcome readers to send any accounts payable job openings they may have and we’ll include them as we can. Send them to publisher@ap-now.com

Click here to sign up for e-AP New, the free weekly ezine focusing on accounts payable issues.

© 2008 Mary S. Schaeffer, Accounts Payable Now & Tomorrow, a CRYSTALLUS, Inc. publication

P-cards and 1099s

July 21st, 2008 by Mary_Schaeffer

I had a note from a colleague who had a client who was using a p-card hoping to not have to issue 1099s for those payments. My pal didn’t think this was quite kosher so he dropped me a line. Alas, my friend was correct. At least at this poit in time, use of a p-card does not relieve an organization from having to issue 1099s.

Here’s how I explained it: He may be paying AMEX in a lump sum each month, but from his bill he knows how much he paid each vendor – and if those vendors would have gotten a 1099 if paid by check, then he still owes the 1099 at year end. There was talk about the credit card companies taking on this responsibility – but to date that has not happened.

 Not only that but he should marry his p-card data with check data to determine if he needs to issue the 1099. For example, if he paid someone $400 with p-cards and $300 with checks, individually he would not have to issue the 1099 – but combined it is over the $600 threshold and a 1099 would be due. The IRS does not care how the payment was made – just that it was.

Wish I could bring you better news.

© 2008 Mary Schaeffer, CRYSTALLUS, Inc. and Accounts Payable Now & Tomorrow

 

Accounts Payable, Tiki Barber, and Unclaimed Property

July 18th, 2008 by Mary_Schaeffer

We recently watched the Dateline segment focused on Unclaimed Property. It’s not often than an accounts payable issue makes it into prime time television - not to mention being hosted by a former member of the NY Giants football team. So, I watched the show, You Might Be Rich, with great anticipation and, to be honest some trepidation.

As might be expected, the focus was on the consumers who were having money returned to them rather than companies who remit (or at least are supposed to remit) the funds and other Unclaimed Property. The show very cleverly interspersed some facts about Unclaimed Property throughout the show, educating the audience while entertaining them with the stories.

While the stories pursued by Tiki’s team showed that some real detective work was needed to locate some of the rightful owners, it also tweaked the states sensibilities by returning money, albiet smaller dollar amounts, to the likes of Joan Rivers and Hulk Hogan.  It is not clear, at least to me, whether this show will become a regular staple of the primetime lineup - and we are investigating to uncover that story. As soon as we figure it out, we’ll post it somewhere on this blog.

We wondered what, if any fallout there would be from the show. Clearly it has raised the public’s awareness of this issue - and probably sent thousands looking for their own unclaimed property. The show provided the www.missingmoney.com website and has included it on Dateline’s own site. This could be a serious blow to those states that rely on income from Unclaimed Property - which Dateline estimates at $30 billion.

Luckily, or perhaps unluckily depending on your point of view, the show did not focus on the relatively low rate of compliance with Unclaimed Property laws. I understand why this was not part of the show - it was meant to entertain the public not educate corporate titans who really should know better.

If this show makes an impact and people start claiming thier unclaimed property in large numbers the states will be forced to increase the number of audits and many organizations who have ignored this issue will have no choice but to address it - with state auditors breathing down their necks. Even worse than having the state auditor on their doorstep (yes, there is a more distressing prospect!) you could end up with a third party auditor working on behalf of the state. Since these auditors are generally paid on a contingency basis they have no interest in researching items to determine if they really should be turned over to the state or may be an exception - say a duplicate payment.

In case you can’t guess, this is an issue I am passionate about. I am very concerned that some of my readers will get caught in an audit. Better to get your Unclaimed Property house in order on your own, before the auditors show up. That’s why Accounts Payable Now & Tomorrow has scheduled several webinars and seminars focused on Unclaimed Property and have a number of Unclaimed Property products to help with this issue. We don’t want anyone to get caught out of compliance.

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© 2008 Mary S. Schaeffer, CRYSTALLUS, Inc. and Accounts Payable Now & Tomorrow

Accounts Payable: W-9 & The IRS TIN Matching Program

July 10th, 2008 by Mary_Schaeffer

First off, as most everyone who works in accounts payable knows, it is a BEST PRACTICE to get a W-9 from every new vendor you do business with. Do not take their word that they are a corporation and you don’t need one (for that may not be true within the next few years). Additionally, and more to the point, they might not be a corporation (even if it says so in their name) and your organization could be on the hook for their taxes not paid, along with penalties for inaccurate reporting. 

Yes, let me reiterate before I start talking about the TIN Matching Program, that within the next few years it is very likely that a W-9 will have to be issued for ALL payments made for services.

Once you get the coveted W-9 (ideally before the first payment is released to the vendor), you can check that the information on the W-9 is correct by verifying it using the IRS’ TIN Matching Program. Everyone should sign up and use it. Those who do report something like a 98% drop in the number of B-Notices they receive each year. Imagine having to deal with 2 B-Notices instead of 100. Not only that, it helps flush out fraudulent vendors who were bold enough to supply a falsified W-9 in the first place. Note: Just requiring a W-9 is enough to scare off a high percentage of the crooks.

So, given the obvious benefit of using this FREE service, why hasn’t everyone signed up? The problem comes with a misconception about the sign up process. Before using the service, the IRS requires a high level organization executive with the authority to bind the organization to sign the organization up for the program. Once the sign up is complete (and none of that information is ever seen by anyone at the organization again), the day-to-day operation of the Matching Program can be turned over to someone in accounts payable.

So, what’s the problem. The IRS wants to make sure that the person signing the company up is who he or she says they are. In order to do this, the IRS requires a little personal information - namely the person’s social security number and their AGI from their last tax return. Now keep in mind, you are not giving the IRS this information - THEY ALREADY HAVE IT. It is just being used by the IRS to verify that the person signing the company is who they say they are.

The tax return number appears to be the problem. Despite be assured that this information can never be accessed by anyone once the application is completed, some CFOs and Controllers drag their feet. This is unfortunate because the service is excellent and companies are being held back by what amounts to an old wives tale. In fact, in some organizations, the accounts payable manager fills in as much of the application as possible and then leaves the room while the sensitive tax information is entered.

In a few organizations this responsibility is delegated in writing to the accounts payable manager by the CFO or the Controller.

Use of the IRS TIN Matching Program is a best practice advocated by all who are interested in running an efficient accounts payable operation. Don’t let the imaginary concern regarding your tax information stand in the way of your organization using what is probably one of the finest developments to come out of the IRS in a very long time.

Want to learn how to use the TIN Matching Program? You can read all the information on the IRS website OR you can listen to the AP Now CD on Using the TIN Matching Program.

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© 2008 Mary Schaeffer

 

Accounts Payable Now & Tomorrow July issue companion story

July 7th, 2008 by Mary_Schaeffer

The July issue of Accounts Payable Now & Tomorrow contains an article about what to do when management dumps employees on accounts payable. This happens either because the employee is not performing well in another department or because the person in question is a relative or friend of a high level executive or Board of Diretor member.

As promised, this piece contains my real life experiences when presented with such a situation many years ago. At the time I was one of several mid-level managers at a large insurance company. I was asked to take a young man to lunch and interview him. He had recently graduated from college. I should have been suspicious. Whenever I was given the “opportunity” to go to lunch at a nice restaurant when one of my bosses could have gone there was usually a catch.

And, as I was to find out, this time was no exception. During our rather uneventful lunch the young man confided his long term career goals. He wanted to work for our company for two years and then we had taught him everything he needed to know about Treasury, he wanted to go work in a different, more glamorous industry. I saw stars. Hint to young job seekers: No company wants to train you for another firm. So, even if this is your real goal, keep it to yourself.

When I got back from lunch my boss asked me what I thought. I was rather emphatic that we not be the training ground for some other company. I thought he agreed - so imagine my surprise a week later when he informed me we had hired the young man. I was outraged. He then shared something he had not told me earlier. The rest of the management team within the department shared my opinion - but it did not matter. Someone on the Board of Directors wanted us to hire him - and the interviews were just a formality. Whether we wanted him or not, he was now part of our staff.

Needless to say, this did not sit well - but what are you going to do? This is a story with a surprise ending. The young man turned out to be quite nice, he worked hard and did his best to fit in - and I ended up leaving the company before he did.

I’m not naive. I know that most tales of people being dumped into departments that do not want them do not end as this one did. However, I am a firm believer that if you give most people a chance, they will work and you can ‘make lemonade out of lemons.’

Also, for the record, this was the second time this department had the dubious pleasure of such a hire - and the first time, it was such an unmitigated disaster the department was finally given permission to terminate the employment of the person in question - and in fact, we used to tell, “remember when so-and-so did ….” stories.

Mary Schaeffer

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© 2008 All rights reserved. Mary Schaeffer and Accounts Payable Now & Tomorrow, a CRYSTALLUS, Inc. publication

 

Accounts Payable, Unclaimed Property & Delaware

July 7th, 2008 by Mary_Schaeffer

The recent announcement that the state of Delaware was decreasing the dormancy period for certain types of securiites from five years to three years is supposed to make a nice contribution to the Delaware budget.

To be perfectly honest about this, I really didn’t think it would make much of a difference - that it just represented one more way the states were nickeling and diming everywhere they could to get a few more dollars into the state coffers. Then I saw the numbers for what looked like a minor change in the unclaimed property rules for a small state, albiet one that gets quite a bit of income from unclaimed property.

Some experts estimate that this one small change is supposed to add $90 million to Delaware’s bottom line. Given the state of the economy, it is no wonder Delaware made this change - and I suspect at least a few other states will follow suit.

Resources from AP Now to help you with your Unclaimed Property Issues:

Upcoming webinars (CDs also available):

1) on July 22 Unclaimed Property: How to Get in Compliance If You’ve Never Filed
2) on September 25 Avoid the Ten Most Common Unclaimed Property ‘Gotchas’

Upcoming seminars:
1) On September 26, an all day UP Intensive Best Practice seminar in Los Angeles at the Beverly Hills Marriot Residence Inn and

2) On October 3 another all day UP Intensive Best Practice seminar in Cinncinatti at the Cincinnati Marriott at RiverCenter

For details about either seminar, go to  http://ap-now.com/UPseminar.html

Unclaimed Property Toolkits and Products

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Mandatory Resort Fees

July 1st, 2008 by admin

If there’s one thing that drives me crazy (okay - there’s quite a few things, but I’m only going to talk about one issue here) it’s the resort fees charged by certain hotels which are mandatory. And, these often present problems in accounts payable - but I’ll get to that in a bit.

To my way of thinking, if the resort fee is mandatory, it’s part of the price and I’d prefer the hotel tell me the ‘real’ price instead of pretending it is lower than it actually is. I recently was making a reservation and was presented with a ‘mandatory resort fee’ and asked the person taking the reservation why they didn’t just include it in the price and be done with it. This is what I was told (and I’m not making it up). “The reason the hotels break out the ‘mandatory resort fee’ is their customers prefer it this way.”

Yeah, that’s right, I thought. I’m sure every professional traveling on company business is just delighted to go back home and explain to a questioning boss why he or she has a resort fee on their hotel bill.

And, it’s not a picnic down in accounts payable either. Because, the bill rarely says mandatory on it. It just lists the resort fee. Then when doing policy compliance for T&E expense reports accounts payable is faced with an expense that is often not allowable under the T&E policy. I know of few organizations that will pay spa or gym fees for their traveling employees - and unfortunately that’s what the resort fee looks like.

What this customer would like from hotels she stays at is honest pricing -without the hidden extras. What about you? Does this issue create problems in your organization? If you have thoughts on this matter that you wouldn’t mind being posted, please either post here (registration required) or send them to marys@ap-now.com If you want to remain annonymous, simply say so in your note and I’ll leave off your name when I post you thoughts.

In addition to serving as editorial director of Accounts Payable Now & Tomorrow, Mary Schaeffer is the author of over a dozen business books published by John Wiley & Sons including Travel & Entertainment Best Practices. She has spoken on T&E issues on several webinars and created the T&E toolkit to help those looking to implement best practices in their Travel & Entertainment operations.

© 2008 all rights reserved Mary Schaeffer, Accounts Payable Now & Tomorrow, a CRYSTALLUS, Inc. publication

Future of Accounts Payable

June 25th, 2008 by admin

I was recently asked to give a talk on one of my favorite subjects: The Future of Accounts Payable. The person asking had no idea how much I like talking about this issue.  In fact, I even wrote a small book about it.

For a long time I have wanted to write a book for accounts payable professionals - to help them with their careers. I was adamant that the cost of this book be under $10 because I wanted virtually everyone who wanted it to be able to afford it. When I broached my editor at John Wiley with this suggestion he was not exactly encouraging. In fact, he told me that his organization could not do it at the price I wanted.

So, Accounts Payable Now & Tomorrow published it. We conducted a rather extensive survey of both accounts payable professionals and controllers. We asked each about their perception of the status of the accounts payable manager within the organization. Controllers were asked what skills, experience and education they would like in the next accounts payable manager they hired.

We compiled this data into a small 52-page book and managed to publish it at the cost I wanted. Perhaps one of the most interesting results related to the college education issue. While most wanted their new AP managers to have a college degree, it was not rated high on the list of what was important. From this we deduced that the college degree might be necessary to get you in the door (or an interview) but once there, other things were more important.

Perhaps the skill most prized by Controllers was the ability to solve problems.

For more information about this book go to the bottom of http://www.ap-now.com/special.html An order form is available for download for anyone who needs to order it and pay by check.

To purchase this $9.95 gem go to http://www.shop.ap-now.com/product.sc?productId=58&categoryId=4

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