The accounts payable process may be streamlined through the utilization of many best practices which can be listed in this chapter; however, a standard recurring problem is those payments that bypass the entire preplanned payable process. They are the inevitable payments that are sudden and unplanned and that must be handled immediately. Examples are payments for pizza deliveries, flowers for bereaved employees, or cash-on-delivery payments. In most of these cases, the accounting staff must drop what it does, create an information check, get it signed, and enter the data on the check to the computer system. To make matters worse, due to the rush basis of the payment, it is common for the accounting person to forget to help make the entry in to the computer system, which throws off the bank reconciliation work by the end of the month, which creates still more work to track down and fix the problem. In a nutshell, issuing manual checks significantly worsens the efficiency of the accounts payable staff. It’s possible to use two methods to lessen the amount of manual checks. The initial method would be to take off the inflow of check requests, while the second is (paradoxically) to automate the cutting of manual checks. The initial approach is really a hard one, since it needs tallying the manual checks that have been cut each month and following up with the check requesters to see if there might be a more orderly types of making requests as time goes by, thereby allowing more checks to be issued through the conventional accounts payable process. Unfortunately, this practice requires so enough time communicating with the check requesters that the lost time will overtake the resulting time savings by the accounting staff from writing fewer manual checks. The 2nd, and better, approach, is to preset a printer with check stock, so that anyone can request an always check anytime, and an accounting person can immediately sit back at some type of computer terminal, enter the check information, and have it print out at once. This method has the unique benefit of avoiding any trouble with not reentering information to the computer system, because it will be entered there in the very first place (which avoids any future difficulties with the bank reconciliation). It tends to take slightly longer to create a register this manner, but the entire time savings are greater.
If one adopts this process, it is very important to take into account the price of the printer. As it is generally a higher priced tractor-feed model, this approach may not be cost-effective unless there are certainly a substantial amount of manual checks being created. A next alternative is to really make the process of making a guide check so hard that requesters will avoid this approach. For instance, the request may require the signature of a senior manager (who will soon be significantly less than pleased to be interrupted for the signature) or multiple approving signatures. Furthermore, the accounting department could charge an exorbitant amount for this service to the requesting department on the corporate financial statements. Further, a report itemizing all manual check requests can be sent to senior management each month, highlighting who’s bothering the accounting staff with your items. Any combination of these actions should reduce the utilization of manual checks.