What is Accounts Payable?

Simply stated, accounts payable is the term used to describe the amounts owed by an organization to its creditors. More technically put, accounts payable pays third parties or employees by scheduling and preparing checks, resolving purchase orders, insuring credit is received for outstanding bills, and issuing stop-payments or purchase order amendments. Accounts payable, often abbreviated “A/P,” also tracks budget expenses.

How is it monitored?

Outstanding balances can sink even the biggest businesses - which is why it is vital for accounts payable to be overseen by a financial expert with experience in A/P. Ideally, this financial expert (from either inside or outside the company) is qualified and capable of analyzing an organization’s cash flow. To be successful in this role, an A/P Specialist maintains meticulous records of outstanding payables. Effective monitoring practices should be put into place to make sure that payments are made to vendors in a timely manner, while also protecting businesses against unintentional overpayment.

Weekly report monitoring, payment oversight, and organized invoices allow the best Accounts Payable professionals to help businesses avoid hidden costs, interest charges, and late fees – while giving an accurate idea of actual cash flow.

Accountant skill set

  • Organization and prioritization skills
  • Attention to detail
  • Confidentiality
  • Problem solving skills
  • Ability to complete work on schedule

Experience & Qualifications

Your background may have to include:

  • High school diploma
  • 0-2 years of experience in the field or in a related field
  • Familiarity with accounting programs and software
  • Basic understanding of principles of finance, bookkeeping and accounting

Accountant role and responsibilities

Accountants provide financial information about the organization to management. Accountants must apply accounting principles and handle work that is analytical, evaluative, and advisory in nature and that requires an understanding of both accounting theory and practice. The accountant also:

  • Calculate, post business transactions, process invoices, verify financial data for use in maintaining accounts payable records, and provide other clerical support necessary to pay the obligations of the organization
  • Clarify any questionable invoice items, prices or receiving signatures
  • Obtain proper information and/or data regarding invoice payments
  • Assemble invoices to be completed for payment
  • Verify and calculate all extensions and totals on invoices (calculating and taking discounts when applicable),
  • Review invoices and requisitions for satisfactory payment approval
  • Check vendor files for any previous payments and assign voucher numbers
  • Maintain copies of vouchers, invoices or correspondence necessary for files
  • Prepare vouchers listing invoice number, date, vendor address, item description, amounts and coding per accounting policies and procedures
  • Type periodic reports and other records
  • Reconcile bank statements

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Accounts Payable Salary

Job Average Base Salary Years of Experience Minimum Credential Preferred
Accounts Payable Clerk 40,444 0-2 HS Diploma
Accounts Payable Specialist 41,570 0-2 HS Diploma
Accounts Payable Specialist, Sr. 52,678 2-4 HS Diploma
Accounts Payable Supervisor 57,321 4-7 Bachelor’s Degree
Payable Manager 81,251 7 or more Bachelor’s Degree

Accounts Receivable vs Accounts Payable

What is the difference between accounts receivable and accounts payable? You can think of A/R and A/P, and the job responsibilities involved with each, as the inverse of the other. While accounts receivable acts on behalf of the assets a company has a right to collect; accounts payable keeps busy with the outstanding bills a company needs to pay out. Accounts receivable, as a more externally focused function, handles billing and the collection of owed monies in a timely manner. The accounts payable function, being more internally focused, is responsible for the disbursement of funds to pay the bills owed to third parties. But both accounts receivable and accounts payable must work together to ensure the organization continually collects the appropriate funds from its customers in order to meet its own financial obligations.

Similar positions

  • Accounts payable specialist
  • Billing specialist
  • Accountant
  • Bookkeeper

Career Advancement

Depending on the path, accounts payable specialists can become:

  • Senior accounts payable specialist
  • Accounting clerk
  • Payroll clerk
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