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Payables prevents you from closing an accounting period until you post all transactions with an
accounting date in that period. If there are unposted invoices or payments that you want to move
forward into the next accounting period, you can submit the Unposted Invoice Sweep program to
move them forward.
]ou should close a period when no one is entering any invoices or payments. This way you
avoid the possibility of someone entering (without saving) a transaction in an open period, you
close the period, and someone then saves a transaction. If this does happen, just submit the
Unposted Invoice Sweep program.



   
 
 

1. 
  
 
    

p See: Approval.

p See: Confirming Payment Batches.

2. ×  



  
      

p Submit the Expense Distribution Detail Report for unposted invoices.

p Submit the Posting Hold Report and resolve holds before posting.

p Review Payment Register.

3.  
  
       
 
 



 
 

 


p Accounts Payable Journal Entry Exception Report.

p Accounts Payable Journal Entry Audit Report.

p Posting Hold Report.

4. ¦
 
 
 
  

   
 (optional).

p Submit the Unposted Invoice Sweep Program.

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p See: Controlling the Status of AP Accounting Periods.

6. ×
    
  
 See: Reconciling Payables Activity. ]ou
will need the following reports:

p Accounts Payable Trial Balance Report (this period and last period).

p Posted Invoice Register.

p Posted Payment Register.

 w. —


  
  


   See: Purchasing
Integration.
8. 


   
      
      
 
     See: Reconciling Payables Activity to General Ledger.
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0hen you set up Payables you choose a primary and an optional secondary accounting method
in the Payables Options window. The accounting method you choose determines the
distributions Payables creates when you post your transactions. For each accounting method,
cash or accrual, you choose a set of books to which you will to post transactions. ]ou cannot
change your primary accounting method after you post your transactions.

Set up Payables to create accounting entries in compliance with one of the following accounting
methods:

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]ou record only payments, and do not record liability
information for invoices. The payment distributions typically debit your expense
or asset account and credit your cash or cash clearing account. 0hen you post
payments, Payables may also create distributions for discount taken and foreign
currency exchange gain or loss.

p  
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]ou post accounting distributions for invoices and
payments. The invoice distributions generally debit your expense account and
credit your liability account. For prepayments, Payables creates distributions that
debit your prepayment account and credit your liability account.

Payment distributions typically debit the liability account and credit the cash or
cash clearing account. 0hen you post payments, Payables may also create
distributions for discount taken and foreign currency exchange gain or loss.

p c
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 ]ou maintain one set of books for cash accounting
and one set of books for accrual accounting. ]ou choose which will be your
primary set of books and which will be your secondary set of books. Invoice
distributions are recorded for your accrual set of books, and payment distributions
are recorded in both your cash set of books and accrual set of books.

Combined basis accounting allows you to produce financial reports for either your
cash or accrual set of books. For example, you may want to manage your
company on an accrual basis, but require cash basis accounting information for
certain regulatory reporting on a periodic basis.
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The accounting distributions for an invoice payment typically debit expense or asset accounts
and credit your cash or cash clearing account. 0hen you post payments, Payables may also
create distributions for discount taken and foreign currency exchange gain or loss.

Payables uses the payment date as the accounting date for your expense and cash journal entries
so that journal entry batches balance.

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The following examples are identical to the accrual basis examples in Figure 1 - 13, except they
assume you use cash basis accounting. Note that Payables does not record any liability
transactions when you use the cash basis accounting method.

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]ou enter and approve an invoice for $100 with payment terms that allow you to take a 10%
discount on the invoice if paid within 10 days. 0hen you post the invoice, Payables does not
record any invoice transactions. If you initiate posting, Payables will not record any invoice
transactions.
]ou pay the invoice and take the discount. 0hen you post the payment, Payables records an
expense and cash transaction along with the discount transaction.

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]ou enter and approve a $100 invoice and a $25 prepayment. If you initiate posting, Payables
will not record any invoice or prepayment transactions.

]ou then pay the prepayment and apply the prepayment to the invoice, reducing the amount due
on the invoice. ]ou pay the remaining amount of the invoice and initiate posting. The resulting
prepayment journal entry credits your cash account and debits the prepayment account for the
amount of the prepayment. The invoice payment journal entry credits your cash account for the
reduced invoice amount and debits your expense account.

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