guide for end-of-year ap best practices - avidxchange · contents year-end checklist for accounts...
TRANSCRIPT
“HOW-TO”
Guide for End-of-Year AP Best Practices
2015 - 2016
Contents
Year-End Checklist for Accounts Payable
Sample Year-End Calendar
Master Vendor File – Clean-Up and Maintenance
1099 Misc. Reporting and Corrections
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Establish a calendar that contains all deadlines and due dates
Assign year-end related tasks to appropriate team members
Review vacation schedules to ensure adequate AP staffing
Research and properly account for any outstanding checks
Remind all employees of invoice and T&E deadlines for 2015
Establish proper procedures for invoice and T&E accruals
Review 1099 supplier information to make sure it’s complete
Make sure that all invoices that have been received are entered into the system
Perform open PO analysis of what has been received, but not invoiced
Review all invoices received shortly after the new year to determine if they should be accrued
YEAR-END CHECKLIST For Accounts Payable
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Sample YEAR-END CALENDAR For Accounts Payable
DECEMBER 2015
SUNDAY MONDAY
Review vacation schedules to
ensure adequate AP staffing.
Open PO Analysis of goods received, but
not invoiced.
Make sure that all invoices that have
been received are entered into the system.
AP Closes (No additional invoice or T&E entry for 2015
after 5pm.)
Review 1099 supplier info to make sure it is
complete.
Send email to all employees about
submitting all 2015 expenses to AP.
Send reminder email to all employees
about submitting all 2015 expenses to AP.
TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY
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24 25 262120 22 23
17 18 191413 15 16
10 11 1276 8 9
3 4 51 231
31
SUNDAY MONDAY
HOLIDAY!
Continue 1099 process. Make sure all reportable payments
are flagged.
AuditorsArrive
Print and Stuff1099’s
Mail1099’s
Continue 1099 process. Make sure all reportable payments
are flagged.
Make any necessary adjustments to
1099’s.
Make any necessary adjustments to
1099’s.
Accrue 2015 AP invoices and T&E. Order 1099 forms
and envelopes.
Accrue 2015 AP invoices and T&E.
Accrue 2015 AP invoices and T&E.
Accrue 2015 AP invoices and T&E.
Accrue 2015 invoices over $5K.
Accrue 2015 invoices over $5K.
Accrue 2015 invoices over $5K.
Accrue 2015 invoices over $10K.
Accrue 2015 invoices over $10K.
Begin 1099 process. Review payment
reports.
TUESDAY WEDNESDAY THURSDAY FRIDAY SATURDAY
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Sample YEAR-END CALENDAR For Accounts Payable
JANUARY 2016
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Financial Stability Taxpayer ID Number Validation Name and Address Validation The Federal Government
WP
TIN
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Master Vendor File Database
Key Role
Setup is Critical
Master Vendor File Database
Restricted
Purge
Audit Changes and Additions
Standardize Data
Duplicate Vendors
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Best Practices
Master Vendor File Clean-Up
ezIndependent Contractors Certain Types of VendorsSub-Contractors Attorneys
Cash Payments to Fishermen Prizes and Awards Proceeds Paid to Attorneys Rent Services (Including Parts and Material)
1099-Misc Reporting
Form 1099-Misc?
$600 or More
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- OR -Simple or “Error Type I” Corrections Complex or “Error Type II” Corrections
1099-Misc Corrections
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Two types of 1099 corrections that can be filed:
Incorrect Payment Amount
Incorrect Payee Name
Incorrect Payee Indicator
Return Filed in Error (One should not have been sent.)
1099-Misc Corrections Continued
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Simple or Type I Corrections:
No Payee TIN
Incorrect Payee TIN
Incorrect Payee Name and Address
Incorrect Return Filed (1099-Misc Instead of 1099-INT)
1099-Misc Corrections Continued
Complex or Type II Corrections:
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The payee presents new information and requests a corrected return after the return is filed.
The payee is an exempt recipient, such as a corporation.
A contractor requests that only their fees be reported, and not reimbursed expenses.
When Not To File Corrected Returns Simply because a payee requests a corrected return does not mean the payer is required to file one.
1099-Misc Corrections Continued
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1099-Misc Corrections Continued
Payers do not have to file corrections in the same manner as the original returns. If a payer has 250 or more returns they are required to file electronically. The IRS requires that only the corrected returns be sent when filing corrections. Make sure to check the “correction” box! Corrections can be filed for the past three years; four if there is backup withholding involved.
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