In the business world, Accounts payable play a vital role in the operation. Account Payable department is a department responsible for handling payments. They are charged with the sole responsibility of paying vendors, suppliers, and creditors the business has.
To become an accounts payable officer, it’s expedient you have full knowledge of the roles of accounts payable and the required skills and educational qualifications. Fully understanding these will help you in making the right choice.
In this article, we have put down relevant information about accounts payable and all it entails. You will learn accounts payable job descriptions as well as the required educational qualifications and lots more. Read through!
Table of contents
What is Account Payable
Account Payable is a business department or unit that takes care of all the payments the business is supposed to make to its creditors, vendors, and suppliers. For small-scale businesses, accounts payable are part of the accounting section or unit. The role can be played by the accountant.
Accounts Payable ensures that a business pays all outstanding debts on schedule and that the bills it receives are accurate.
For example, they verify that the amounts owed are accurate and that all of the invoices they receive comply with general invoicing and VAT regulations. These workers can additionally have added tasks, such as evaluating and approving employee costs.
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What are Accounts Payable Roles in a Business?
Major Roles of accounts payable
The responsibilities of the accounts payable department may be distributed differently among team members in each organization.
For instance, some businesses may assign bookkeepers to handle payment processing, while others may use specialized clerks for that purpose.
The following are the major roles of Accounts Payable:
Producing financial records
One of an accounts payable professional’s primary responsibilities is to create, manage, and produce financial records. These documents are essential for monitoring all cash flow and supplier and vendor payments, as well as for the company’s overall financial stability.
These financial records may be used in the event that the company is audited or is required to provide documentation of a payment. As they keep an eye on the company’s development, the board or executive team may also examine these documents.
Keeping Transaction Records
One of the accounts payable department’s key responsibilities is overseeing the company’s financial transactions. A company can continue to have positive connections with suppliers and vendors when they pay on time.
Businesses can also save money by qualifying for reduced rates from regular vendors if they have a history of making on-time payments.
Proper transaction recording guarantees that the business has a complete payment history and can accurately estimate the costs of supplies and services.
Monitoring spending and earnings
The accounts payable division of many companies closely monitors future costs in comparison to anticipated revenue. Controlling any anticipated costs is crucial since it enables accountants and other financial experts to ensure that the company has sufficient revenue to settle its debts and be solvent.
Verifying the veracity of the numbers
Professionals in accounts payable also ensure that all of the figures in the financial records are correct and up to date.
Maintaining a thorough record with precise figures guarantees that the firm complies with legal reporting obligations and can protect the organization in the event of an audit.
Managing audits
If a business faces an audit, the accounts payable department may work with government officials or other individuals involved to provide the necessary records and information. They may answer detailed questions about the company’s financial access and retrieve accounting records for the auditors.
Other roles of Accounts Payable include:
- Getting in touch with the appropriate vendors to handle payment or invoice inquiries
- Posting invoices and credit notes and making sure they are appropriately categorized in the system, as well as reconciling purchase orders with invoices received and attaching the appropriate paperwork to them
- Preparing monthly supplier statement reconciliations
- Responding to internal and external inquiries via email and phone
- Making sure a senior finance manager has approved all supplier payments after they have been prepared and processed
- Ensuring that all accounts payable activities conform with relevant financial regulations and procedures
- Examining and settling unpaid creditor issues.
Note, Accounts Payable’s responsibilities are based upon their workplace. While those who work in smaller settings might have a larger range of responsibilities, those who work in huge financial departments might have a narrower one.
Creating payment estimates for management or communicating with suppliers about predetermined payment profiles are examples of additional duties.
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What are the Required Skills for Accounts Payable
In businesses, Accounts Payable is specifically responsible for making payments to vendors and suppliers on behalf of the business. They help avoid careless mistakes that could be expensive, like inadvertently overpaying debtors.
Accounting must work carefully and pay close attention to detail in order to prevent errors and efficiently monitor accounts payable transactions.
There are skills required for any professional accounts payable to have. Some of the skills include:
- Accounts Payable must have good communication skills. He must have the ability to communicate and listen to others.
- He must possess building relationship ability. He must maintain a good business relationship with their suppliers, vendors and creditors.
- Good working knowledge of general accounting procedures is required.
- IT literacy, including knowledge of relevant accounting software, such as QuickBooks, Sage and ERP systems
- Strong organisational skills, as they typically handle high volumes of invoices
- The ability to work well in a team and collaborate with others.
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Accounts Payable Tools?
Apart from the professional skills that help Accounts Payable play their roles perfectly well, there are also tools that assist them. As an accounts payable officer, it’s expedient you have full knowledge on how to use these accounts payable tools if you must advance in your career.
Some of the tools include:
An accounts payable officer’s tools and technology of the trade depend on the employer but typically include:
- Accounts Payable software: Among the many features of an accounts payable software system are electronic banking interfaces, supplier relationship management (SRM), contract management, invoice processing, and payment tracking. Common software applications include SAP, XERO, and QuickBooks Online.
- Microsoft Office: This includes both Excel & Outlook. With this tool, you can manage your roles and duties.
The internal software and systems that an organization selects have a significant impact on the technology that an accounts payable professional uses.
Software used in one accounts payable job might not be used in another since various businesses may use different accounting programs, such as MYOB or XERO.
Accounts Payable education and training
For this job, there are no set educational or training requirements. Employers, however, frequently demand that applicants possess a minimum of a few GCSEs from grades 9 through 4, typically in math and English.
Some applicants decide to take college courses in order to expand their expertise in the industry.
The Level 2 Certificate in Accounting and the Level 2 Certificate in Manual and Computerized Bookkeeping are pertinent credentials.
Relevant credentials, such as a Level 3 Advanced Certificate in Bookkeeping, are also provided by professional associations like The Association of Accounting Technicians (AAT).
According to Indeed Salaries, the average salary for an Accounts Payable specialist is $47,877 per year in the United States and £14.10 an hour in UK depending on factors like location, employer and level of experience. On the other hand, a accounts payable clerk in the United States earns about $22.00 per hour.
FAQs
Accounts Payable is a business department or unit that takes care of all the payments the business is supposed to make to its creditors, vendors, and suppliers.
Accounts Payable reports to either the Accounts Payable Manager, a Financial Accountant or a Finance Director.
Accounts Payable roles include:
Getting in touch with the appropriate vendors to handle payment or invoice inquiries
Posting invoices and credit notes and making sure they are appropriately categorized in the system, as well as reconciling purchase orders with invoices received and attaching the appropriate paperwork to them
Preparing monthly supplier statement reconciliations
Responding to internal and external inquiries via email and phone
Making sure a senior finance manager has approved all supplier payments after they have been prepared and processed
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Conclusion
The role of an Accounts Payable professional is vital to the financial health and smooth operations of any organization. They are responsible for managing invoices, processing payments, maintaining accurate records, and ensuring that all financial obligations are met on time. Beyond handling day-to-day transactions, they also play a key role in building strong vendor relationships and supporting compliance with company policies and financial regulations. As businesses continue to grow, the need for skilled Accounts Payable specialists remains in high demand, offering individuals a rewarding career path with opportunities for advancement in the broader field of accounting and finance.
References
- Uk.indeed.com-accounts-payable
- Hays.com.au-job-description
- Indeed.com- accounts-payable
