Excerpted from the January 2010 issue of Accounts Payable Now & Tomorrow.

Paper checks are costly, inefficient, and a huge headaches for those toiling away in accounts payable. Yet they remain the tool used to pay the majority of invoices, even at many organizations with the ability to pay electronically. To change this situation, it may be necessary to go on the offensive and find ways to grow your ACH program. It’s certainly worth the effort, given the nuisance of paper checks. What follows are seven assertive techniques to grow an ACH program be it one that is languishing or one that’s thriving but could use a little extra oomph.

Don’t overlook your Web site. Publish ACH information on the company Web site. Occasionally a vendor you might not have approached will want to participate. Make it easy. Also, if you are going to take this approach, include your vendor enrollment form on the site. Do this only if you are willing to include all vendors in the program. Otherwise, you may find your p-card vendors signing up for the program—and there goes your rebate.

The rest of this article, along with articles on: bank account takeovers that lead to unrecoverable transactions, AP New Year’s resolutions and how to keep them, 1099K (a new proposed IRS form), the Procurement/Finance Gap (an excerpt from a fine Baseware white paper), a naming convention check list you can use for your master vendor file, a look at recovery audits, and a overview of advanced 1099 issues for W-9s, are all in the January issue of Accounts Payable Now & Tomorrow. Of course, the issue also includes two pages of tips and strategies you can use to fine-tune your AP process.

You can purchase the single issue using the link below or subscribe for one or two years and receive our quarterly podcasts as part of that subscription.

Purchase an electronic copy of the January 2010 issue of AP Now newsletter.

(c) 2010 Accounts Payable Now & Tomorrow and CRYSTALLUS, Inc.

Do you have written policies and procedures that explain exactly how you classify workers? If not, you are already headed down the wrong worker classification path. At Accounts Payable Now & Tomorrow’s Worker Classification Webinar  Balance Consulting’s Steve Mercatante, Esq. alerted the audience to the dangers of not having one. Before we started, he told myself and Kathie, our intrepid managing editor, that he was apprehensive that he would sound too lawyerly and that would bore the audience. 

As incredible as this may sound, especially given the topic, Mercatante was anything but dull. He started out by quoting a Wall Street Journal article that indicated in the last six years, there were 11,000 audits that resulted in 483,000 workers being reclassified and costing the organizations that employed them three quarters of a billion dollars (yes, billions) in back taxes and penalties.

He also pointed out that the IRS no longer strictly follows the 20 Factor Test (remember that?). CDs of the event are available for sale.

To make sure you get your TIN Solicitation procedures right, please join us on April 2 as Mercatante’s colleague, Denise Johnson, Esq., addresses the issue of W-9 & W-8 TIN Solicitations: A Best Practice Program for 2009 and Beyond.

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

Every time I hear someone say, “What’s the big deal? You get an invoice and you pay it! What’s the big deal?” I go ballistic.

As those conversant with accounts payable issues know only to well, this type of attitude leads to:

• Duplicate Payments
• Erroneous payments 
• Payment of fraudulent invoices
• Low morale in AP
• Low productivity in AP
• Unclaimed Property issues
• 1099 Problems and hence potential IRS issues

and our readers can probably add a few more of their own. The big deal about AP is it’s your money and poor handling can have a direct bottom line impact - and we’re not talking about an enhancement either.

Return to the Accounts Payable Now & Tomorrow home page

“If/when the proposed changes for 1099s go into effect and businesses are required to use the TIN Matching Program, do you see this program changing,” writes one of our readers. “The main piece I am interested in is the fact that it requires personal information.  Finding someone within a larger organization who is willing to put their personal info out there for the business purpose has been difficult.” This got me thinking. I know this is a common problem in about half the organizations that want to use this helpful program.

This is an issue that drives me crazy. It doesn’t have to be. It’s not like the executive in question isn’t filing his or her taxes.

Occasionally, explaining to the executive in charge that the information is used only by the IRS to verify their identity helps. Additionally, the information can be input when no one else is around and is not retrievable afterwards.