Accounts payable & Procure to Pay guide - 200 Q&A Test

Procurement starts when the user department identifies requirements and computes quantities for current and future needs, aligned to delivery lead times and budgets; justify cost and obtain approval.

Raise a purchase requisition to request goods or services, detailing quantity, specifications, and timelines, and indicate one-time or recurring; obtain approvals per the authorized approval matrix and submit to procurement.

Reviewing a purchase requisition, the procurement team checks inventory and places an order with an existing or new vendor if stock is below reorder level or for services.

Empanel new vendors by evaluating quality, pricing, and credibility, issuing RFPs/RFQs, negotiating master contracts, and conducting vendor due diligence to ensure financial stability and reliable delivery within the procure-to-pay process.

Cleanses existing vendors quarterly to maintain a healthy base and identify inactive vendors for deactivation. Manage one-time vendors for emergencies, apply automatic deactivation, and blacklist noncompliant suppliers to safeguard operations.

Learn how purchase orders, including standard, blanket, plan, and contract-based orders, authorize procurements, track delivery, and establish the basis for payment against invoice.

Confirm service receipt and goods acceptance with GRN or MRN to enable 3-way or 4-way invoice matching, apply tolerance limits, update inventory, and handle purchase returns.

Verify the receipt of an invoice pack and confirm key details—invoice number, date, customer name, addresses, tax IDs, PO references, item details, price, discounts, and taxes—to accept or reject.

Explore OCR and intelligent data capture that converts invoices to text, extracts vendor and invoice details, line-level data, tax info, and validates accuracy with manual corrections.

Validate invoices with 2 way, 3 way, and 4 way matches against PO and GRN. Classify expenses as capex or opex and confirm service acceptance; note non-po invoices.

Verify supporting documents for diverse expenses during invoice reviews, including delivery proofs, work completion certificates, timesheets, transport logs, and license references.

Identify invoice disputes—pricing, quantity, quality, errors, missing purchase orders, or misapplied discounts or taxes—and inform the buyer and notify the vendor for clarifications or resubmissions, with reasons.

Move invoices from first level review to the approver for second level validation of validity, accuracy, and accounting and taxation aspects; approve for payment or reject for modifications.

Explain why approved values may be lower than invoices, noting damaged items, incomplete deliveries, missing items, discounts, early payments, delays, penalties, and retention. Release only the approved value per contract.

Understand how payment terms shape working capital by timing payments and extending credit; determine due dates from invoice date or invoice submission date, per policy.

Initiate a payment run on the cycle day to process approved invoices due by the run date, with holds and urgent releases applied through approvals, forming a bulk payment batch.

Learn how bank approvals govern payment releases after batch finalization, covering manual checks, electronic transfers, and card payments, with two-level approval and policy-driven p-card usage.

Understand how released payments reconcile across transaction, module, and general ledger levels, closing invoices at the transaction level, reducing vendor payables and accounts payable balances, and addressing exceptions to reconcile.

Review aging of POs, invoices, and GRNs to identify delays and duplicates, then resolve with vendors; assess accruals and prepaid expenses during month close.

Practice segregation of duties across accounts payable and procure-to-pay to prevent errors and fraud. Implement key controls for PO ratification and bank account updates with independent verification.

Apply internal controls to detect duplicates across vendors, vendor master, invoices, and purchase orders; centralize invoices; verify payments against original invoices with purchase order references. Implement an approval matrix.