In most situations, payments for accounts payable invoices are made to the same vendor and address which were used when entering the accounts payable invoices. However, in some situations, it may be necessary to forward payment for an accounts payable invoice to a different address than the address which was used when entering the invoice. In other situations, payment for an accounts payable invoice must be made to a company (vendor) other than the vendor used when entering the purchase order and or accounts payable invoice. These situations often occur due to:
• Large vendors who have multiple addresses. In some cases, a vendor has one address for incoming purchase orders and a different address to be used for payments (such as a lockbox address). When these situations occur it is important that the payment be sent to the proper address to ensure that it is credited promptly.
• Credit Card Purchases. In some situations you may place a purchase order with a vendor and then pay for the goods using a company or personal credit card. When these situations occur it is desirable to record the purchase order using the actual vendor from whom the goods were purchased, and to record the liability and or payment for the invoice using the actual vendor to whom the amount is owed or the payment is made.
• Financing Arrangements - In some cases you may have financing arrangements which allow you to purchase goods from a vendor, and which require you to remit payment for the goods to a finance company. When these situations occur it is desirable to record the purchase order using the actual vendor from whom the goods were purchased, and to record the liability and or payment for the invoice using the actual vendor to whom the amount is owed or the payment is made.
The Stream V Accounts Payable system supports three different accounts payable remittance options in order to handle all of these situations efficiently. These remittance options available in the system are:
• Normal Processing. In this situation, an AP invoice is entered and the payment for the invoice is made using the same vendor and address used when entering the invoice. This is the default payment processing method.
• Remit To Address Processing. In this situation, an AP invoice is entered into the system and payment for the invoice must be made to the same vendor used on the invoice. However, the payment must be sent to a different address than that used on the purchase order and or invoice. In this situation it is desirable to use the purchase order address information on the purchase order and accounts payable invoice related to the purchase order, and to show the remit to address information on the check or wire transfer transaction used to pay the invoice. This situation is handled using a Remit To Address which is stored in the Vendor Manager file. A Remit To Address can be entered for each vendor and if a remit to address has been entered for a vendor, this address will be used each time a check is printed for the vendor. The Remit To Address option handles situations in which payments to the vendor must always be sent to an address different than that used on the purchase orders and invoices entered for the vendor.
• AP Invoice Assignment. Invoice assignment is designed to handle situations in which you purchase something from one vendor and must remit payment for the invoice to a different vendor. Examples include the credit card and finance company situations described earlier in this section. When goods are purchased from one vendor, and payment needs to be made to a different vendor, the system allows you to record the purchase order and related accounts payable invoice(s) using the vendor from whom the goods were purchased. This allows proper three way matching between the purchase orders, receiving transactions, and accounts payable invoices associated with the transactions, and it ensures that the purchasing history for the vendor is recorded correctly. Once the transactions for the vendor from whom the goods were purchased are recorded correctly, the system allows you to offset (replace) the invoice for the original vendor with a matching invoice which is recorded on the account of the vendor which will be receiving payment for the invoice. This method ensures that all open invoices reflect the vendor to whom the liability is owed, and that payments are forwarded to the correct company. Accounts payable invoices may be assigned to a specific vendor for payment as they are being entered into the system using the Accounts Payable Invoice Entry program. The AP Invoice Entry program allows the operator to input and three way match the accounts payable invoice using the same vendor recorded on the purchase order. The program then allows you to pay off the invoice at the end of the invoice entry process by creating an offsetting (replacement) invoice for the same amount using the vendor that will actually receive the payment. The system posts this transaction to the general ledger as the invoice is saved and the journal entry used to post the transaction also stores information which ties the original and replacement invoice to each other. The result of this method is that purchasing and accounts payable history are correctly recorded using the vendor from whom the goods were purchased, and the open accounts payable and payment history are correctly recorded using the vendor to whom the liabilities were actually owed or to whom payments were actually sent.