SAP FINANCE: A Project on what Account Payable is all about?

A bit about Account Payable:

When a company/Organization buys a good on loan that is needed to pay back in short span of time is called as Account payable. Account Payable is known as a complete list and bookkeeping of a company’s accountability and credit owned because of the buying of good and services. Taking delivery of the products without paying their credit, buying goods on balance, is listed as Account payable.  While keeping correctly, the total balance should be equal to the amount of the outstanding vendor invoices received. The Account payable credit should be equal to the amount of the total of Unpaid Vendor Invoices.

How to Create Accounts Payable?

Accounts payable are listed in a company general ledger under the current liabilities section .The finance department credits accounts payable when the company receives an invoice or payable from a creditor and debits account when the bill owed the person is paid. In the account payable all sub ledger connected with main ledger. In the SAP system recorded double concept as in cashbook that account payable we can recorded all good and services properly which we payment and received of such purchased bill in the account.

Important data in the account payable:

§  Account group=account groups is defines the set up when we creating a g/l account in thecompany code and chart of account. We can use g/l account in the chart of account area, we must specify an account group .The Account group is using we can created the g/l account according to functional area. The cord of account group is (OBD3).

§   NUMBER RANGE=number range is unique number id created for an sap object belongs .the cord to Rate the number range is (XKNI)

§  ASSIGN=we can assign the number range to vendor account. The cord of assign is (OBAS)

§  Change the vendor=the change the vendor if we want the we can use the t, code(xk02)

§  The display the vendor=in the sap display the vendor the t,code is used is (xk03)

Why account payable is important for the company?

Tracking the accounts payable of a business is important in order to keep the finances of the business well accounted and prevent a bookkeeping nightmare. Accounts payable generally have a deadline; failure to keep to the same would cause negative outcome.

A company’s accounts payable should be well tracked and paid for the following reasons:

§  Avoiding Late Payment Fees and Fines Due To Breach of Payment Terms

§  Ensuring Continued Business Relationship with Creditors

§  Improving Credit Score

§  Avoiding Financial Fraud

§  Avoiding Overpayment

The key to high efficiency is the right AP software. The right AP software provides automated invoice processing, which we will discuss in more detail momentarily. The right AP software also automates the approval workflow.

Managing your Accounts Payable efficiently and responsibly is great for your bottom line. Who knew that paying bills could feel so good!

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