AP Automated Payment Processing

When an automated accounts payable payment is processed in StreamV, the system creates a check or a wire transfer record in the Bank file, the selected invoices are closed and a journal entry is made to record the transaction.  If a check run is being processed, the system creates the checks for the invoices being paid but it does not print the checks.  If a wire transfer is being processed, the system also creates a record in the Bank file, it updates the appropriate invoices and it creates a journal entry to record the payment.  Again, the program does not print the detail for the transfer.  No output is sent to any forms or printers by the Create Checks or Wire Transfer program.

Automated accounts payable payments are processed using the Pay Date field in each accounts payable invoice.  As invoices are entered into the system, the system defaults the pay date based on how the vendor and system are configured and based on the payment terms being used for the invoice.  The default pay date calculated by the system for each invoice can be accepted by the operator or changed as required during invoice entry.  The pay date can also be updated at a later time after the invoice has been posted.

When a check or a wire transfer is processed on the system, the operator processing the payment uses a pay date cut-off to select the invoices to be processed.  Additional options are also supported when selecting invoices for payment (such as the vendor name, vendor type, invoice type, etc), but the pay date is used as the primary mechanism for processing payments.

The normal payment processing cycle is as follows.

1.  Check the invoices that are due to be paid.  On a regular basis, a Proposed Disbursement report is run.  The report is run with the pay date cut-off that matches the date on which payment will be made (normally this is the current date).  If any other selections will be used during the check run, these selections should also be used on the Proposed Disbursements report (the idea is to use the report to preview what the check run will look like).

2.  Adjust invoice pay dates as required.  The Proposed Disbursements report is reviewed to determine if the correct invoices and amounts are being shown on the report.

1.  If invoices show up on the report that should not be paid, the pay dates of these invoices should be set to a pay date later than the pay date that will be used for the payment run.

2.  If invoices do not show up on the report that should be paid, the pay dates of these invoices should be set to a pay date earlier than or equal to the pay date that will be used for the payment run.

3.  If the payment amount for an invoice is incorrect (perhaps due to you wanting to make a partial payment or to take a discount), the Next Payment, Next Discount and the Discount Date fields of the appropriate invoice can be adjusted to specify the current amount to be paid.  The Next Payment field normally defaults to the current open invoice balance but it can be changed in order to allow partial payments to be processed.  The discount amount in the invoice is only used when the invoice will be completely paid off (the next payment and next discount are equal to the invoice balance), and when the discount date in the invoice is greater than or equal to the current date.

3.  Verify the invoices to be processed.  The Proposed Disbursement report is rerun to verify that the correct invoices and amounts are shown on the report.  If additional adjustments are necessary, they should be made as described in the prior step, and the report should be rerun until the information on the report shows the correct invoice detail.

4.  Create the checks.  Once the Proposed Disbursements report shows the correct invoices and amounts, the Create Checks or Wire Transfers program should be run using the same selections that were used on the Proposed Disbursements report.  The Create Checks or Wire Transfers program is used to actually create the payment transactions for the vendors and invoices that are being paid.  The Create Checks or Wire Transfers program is used to create the payments but it is not used to print the actual check forms or wire transfer detail for the payments (this logic differs from StreamII where the check and wire transfer programs both created and printed the appropriate documents).  Once the selections in the Create Checks or Wire Transfers program have been made and the Pay button is selected, the program will display the number of invoices being paid and ask the operator to confirm that the number is correct.  The program then creates the appropriate transactions for the payment or payments being processed.    A Bank record is created for each payment transaction, the appropriate journal entries are made to the accounts payable, cash and discounts account, and the accounts payable invoice payment information and the invoice and related vendor balances are updated as appropriate.  Once the Create Checks or Wire Transfers program has finished processing the selected invoices, the invoices are paid, all transaction detail has been created, but the check or wire transfer documents are not yet printed.

5.  Print the checks or wire transfer documents.  When Payment transactions are created using the Create Checks or Wire Transfers program, the check documents or the wire transfer details are not printed by the program.  The Create Checks or Wire Transfers program identifies the payments that it creates as not printed (the printed flag is set to N), and a separate check printing program is used to actually output the check documents.  This design allows you to make any required corrections to the check or wire transfer prior to printing the actual payment document and it also allows you to recover from situations where the print process is interrupted (i.e. plain paper is loaded in the printer instead of check forms, printer is offline, etc).  As each check is printed, the system updates the printed flag in the bank record to indicate that it is printed.  If necessary, this print flag can be set back to N to allow the same check to be printed again.  The Accounts Payable Check Printing program can be used to select from and print any unprinted accounts payable payment transactions.  The report allows you to select the division and check numbers to be output (from a list of unprinted check and wire transfer records), and it outputs the appropriate information based on the check form being used.

More:

AP Check Printing

AP Wire Transfer