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What is the Accounts Payable Department?
Home » Accounting » Accounts Payable » What is the Accounts Payable Department?The company Accounts Payable Department is charged with handling all accounts payable in a timely manner. To accomplish this, the A/P department puts a system of checks and balances in place to ensure that all invoices and payments are correct. In a small business, the owner may also be the Accounts Payable Department, but larger businesses and corporations usually hire a number of employees to handle the different aspects associated with accounts payable.
There are many tools available to assist with tracking accounts payable functions. Historically, purchase orders, invoices, and copies of cancelled checks were filed in massive wooden cabinets in folders labeled for each item. There might have been different drawers for different months or years to make the system more manageable. However, no matter how well the system was organized, it was still difficult to track a purchase from initial order to final payment without pulling out every related piece of paper and later refiling them.
Modern technology, however, makes tracking invoices, flagging them to denote other documents to which they refer, and notifying appropriate personnel when an invoice is due to be paid, a paperless affair. Pulling files and later refilling them has been eliminated in many companies, even those that do not implement a paperless system. The paper copies are still maintained in files, but the accounting personnel have no need to refer to them if data entry is handled accurately.
The software used to track all the pieces of paper involved in accounts payable makes the work as easy as following a checklist and entering data. Accounts payable software has become so affordable that even small businesses are giving up their large file cabinets, ledger books, and Tickler files, replacing them with flatbed scanners and desktop computers. Accounts payable software makes tracking, filing, and paying accounts a seamless process with little margin for error or duplication.
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