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Split Payables Processing Based on Discounts

When a supplier offers an early payment discount, the terms offered are nearly always so advantageous that the payables staff must pay early. However, these invoices tend to be lost amidst the sea of invoices that arrive in the mail every day, resulting in late processing and therefore no discount taken.

To avoid this problem, examine invoices for discounts at the point of receipt, and set aside all invoices offering early payment discounts. This batch of invoices can then follow a higher-speed processing track that uses expedited data entry and approvals. If these invoices are processed manually, use negative approvals (will be paid unless the approver says otherwise) to ensure that early payment is not delayed by a late approval.

If all invoices are digitized at the point of receipt, these invoices can be flagged with a special index code. If prioritized invoices are being approved with a work flow management system, then set them up to be bounced to a different person for approval if they are not approved within a very short time frame by the primary approver.

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