Accounts Payable

Ver : 1.4 AT/F/PR 07 Date : 06/08

1. Objective

The objective of this procedure is to describe all the activities associated in

handling the payable Accounts of Axiom Telecom.

2. Scope

The procedure covers the activities carried in the regions where Finance carries
out its activities

3. Inputs

• Reconciliation Report
• Creditors Ledger
• Asset Form
• Bills
• Expenses Claim Form
• Invoice
• Purchase order

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 Accounts Payable

Ver : 1.4 AT/F/PR 07 Date : 06/08

4. Requirements
Document No: AT/F/SOP
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Activity : Pre-activities Requirements KPI: Supplier control set up in system
Input / Process Record
Process Sequence Responsibility
Reference Step Generated
In case the supplier is a group supplier;
creation to be done by ERP Finance
Analyst.
Category Manager sends E-mail requesting
the creation with the following information
(Supplier name-contact person, and
payment terms & countries to be activated),
As for merchandize local suppliers,
Category Manager sends notification as E-
mail plus hard copy of the contract. If it is a
tax supplier photo copy from tax card to be
E-mail
provided too.
(Supplier
In case of Foreign suppliers, Category
Supplier creation
Manager must send formal letter from the Category
Creation requisition -
supplier include bank detail (account No. Manager
(Stock) before any
Swift code, etc) as reference of any further
activity took
payment of invoices to this account.
place)
If the supplier is consignment; Category
Manager must mention that in e-mail (if it
doesn’t mention; it's normal supplier).
Benefits from the supplier (credit notes
received)
for example ( incentive, rebate , discount ,
special deals ) category manager should
inform finance of the amount and type of
benefit to ensure correct accounting
treatment is done.
For local suppliers; creates supplier in
Oracle and sends supplier number to
Category Manager (Within 24hrs).
Liability Account has to be mentioned
according to the nature of the supplier, & if AP Supervisor/ E-mail
tax available, specify the tax % category + ERP Finance (Supplier
withholding tax (if any). Analyst creation)
One supplier should have minimum one site
& if for more than one country (international
supplier, then each country will have one
site).

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 Accounts Payable

Ver : 1.4 AT/F/PR 07 Date : 06/08

E-mail
(Supplier
Supplier Sends E-mail in details with supplier name, creation
Purchase
Creation contacts, payment terms and hard copy requisition -
Coordinator
(Non-stock) from the contract, tax card (if any). before any
activity took
place)
Creates supplier in oracle and sends
supplier number to Purchase Coordinator
(Within 24hrs.) Liability Account has to be E-mail
mentioned according to the nature of the AP Supervisor (Supplier
supplier, & if tax available, specify the tax % creation)
category + withholding tax if any.

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 Account Payables

Ver : 1.4 AT/F/PR 05 Date : 06/08

5. Activities
Document No:AT/F/SOP-5A
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Activity : Capturing invoices KPI:
Input / Process Record
Process Sequence Responsibility
Reference Step Generated
Stock supplier /
Prepare Warehouse Stock Received Payables
Non stock Stock Received
Vouchers (SRV) log sheet for the day Accountant
suppliers items Vouchers log
sign it & get it signed by Warehouse (located at
received in sheet signed.
Manager warehouse)
warehouse
Reconcile Warehouse Stock
Received Vouchers log sheet match
with ERP Supplier Goods Receipt Reconciliation
Report confirming all the GRNS’ have Payables between SRV
been captured in system Accountant log sheet &
In Case of short delivery, logistic (located at ERP Supplier
inform AP supervisor about the warehouse) Goods Receipt
difference & the gap to be covered by Report
Whom (insurance Credit note on
supplier, forwarded…)
Validate documents of GRNS’ against
GRN available
log sheet or Supplier good receipt
in supplier
report.
account &
Documents to be validated should
ready for future
contain the following:
payments.
1- SRV Payables
2- Supplier invoice Accountant
Send all
3- Air Way bill (located at
document of
4- Copy of the PO warehouse)
that day to AP
Supervisor
(ERP will run automatically pay on
(located at the
receipt auto invoice which will push
office) for
the GRN to Payables Module)
review & filing.

Sign log sheet

confirming all
Review all GRNS’ documents sent by documents
accountant & the log sheet to confirm received &
AP Supervisor
correctness of information & file the having all
same for future payments necessary
documents
attached.

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Non stock
suppliers/
Create PO in system as per DOA
expense
requirements & specify the related
suppliers/ ERP PO
account allocated (for fixed assets it Purchase
services creation as per
will always be assets clearing Coordinator
(no stock DOA
account)
delivered to
warehouse) +
Fixed assets

GL
Approved PO
Reviews PO with allocated account & Supervisor/ as per DOA &
provides the same for Country Country correct data
Finance Manager for approval Finance entry.
Manager

Insure the following:

1. 3 quotations available when

stated by DOA (or approved
supplier list).
2. Insure approved PO is already
available (if stated by DOA)
3. Confirm item receivable (i.e.
Non stock
stationary …), or service already
suppliers/
rendered by obtaining the
expense DOA chapter I /
signatory of the requestor
suppliers/ Payables ERP PO
department.
services Accountant approved +
(no stock invoice created
4. Validate the system invoice (Pay
delivered to
on receipt auto invoice) against
warehouse)
physical document & account the
same (ERP create accounting) &
initiate for approval. Write down
the system generated voucher #
on the invoice for easy tracking.
5. Organize all documents, &
forward for AP supervisor for
review & approval.

Verify all documents received, &

approve ERP. By day end
Once approved, Payables transfers to AP supervisor Auto run to GL
GL (Auto run by day end) will push Module
the entry to GL module.

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Insure the following:

1. 3 quotations available when

stated by DOA (or approved
supplier list).
2. Insure approved PO is already
available (if stated by DOA)
3. Confirm item received (installed
& / or ready for service) by
Non stock DOA chapter II
obtaining the signatory of the
suppliers/ fixed Payables / ERP PO
requestor department.
assets Accountant approved +
4. Validate the system invoice (Pay
purchases invoice created
on receipt auto invoice) against
physical document & account the
same (ERP create accounting) &
initiate for approval. Write down
the system generated voucher #
on the invoice for easy tracking.
5. Organize all documents, &
forward for AP supervisor for
review & approval.

GL
Approved PO
Review PO with allocated account & supervisor/ as per DOA &
provide the same for Country Finance Country correct data
Manager for approval Finance entry.
manager

Provide copy of the fixed asset

invoice to the GL Supervisor for
updating fixed asset module by Copy of
running ‘Mass Addition Create’ which document
will transfer the data to fixed asset AP Supervisor provided to GL
module. Accounts
For immaterial fixed assets (less than Supervisor
2000 EGP or funded from the supplier (as
marketing activity) we should book in the
fixed asset module with amount 0.1
country currency for tracking purposes.
Activity Decision Review & Approval

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5B
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
To maintain the Reconciliation
Activity :Supplier Reconciliation KPI:
variations should be Nil
Input / Process
Process Sequence Responsibility Record Generated
Reference Step
Stock supplier cases,
Insures all suppliers GRN are Confirm all GRN
already posted in the system up to captured (Max
Monthly basis
the date of the reconciliation. AP Supervisor previous day log
Reconciliation
For Non stock suppliers sheet & GRNS’ yet
Insure all invoices captured & to be posted)
posted

Statement from supplier to be

ERP Axiom
received on monthly bases &
AP Supervisor Creditors Ledger
reconciliation against supplier ledger
Report
to be conducted

Pending items for

In case supplier account is common reconciliation
between two countries; provides the Payables (information should
list of un-reconciled entries to the Accountants of be coordinated with
other countries to insure documents both countries 48 hours &
are recorded in that country feedback received
for the same)

Cases of un-reconciled entries:

1- Invoice appearing in supplier

statement & not in our records.
A) items are Good in transit & this is
only if the stock not yet cleared
or fresh delivery (max 7 days)
AP Supervisor
B) Ask supplier for invoice copy
& Country Un-reconciled
plus airway bill as proof of
Finance accepted cases
delivery & confirm with logistics
Manager
for the same.

2- Payment appearing in our

records but not in supplier
statement ( keep copy of
payment as proof of settlement
with all the documentations

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Ver : 1.4 AT/F/PR 05 Date : 06/08

3- Items related to other country &

verification from the other
country to be obtained.
4- Any other case is not
acceptable as it means that
we didn’t fulfill the job
requirement & discipline
should be taken against staff
responsible

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5C
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Activity :Supplier Payment KPI: On-Time payment to suppliers

Process Record
Input / Reference Process Sequence Responsibility
Step Generated

Invoice Received by
Check invoice with purchase Invoice /
Accountant from
order for approval of Department Accountant Purchase
Respective
Head order
Department

Any variations / Purchase Order

missing it will be clarified with Accountant
concerned Department Head

Book it in the ERP system for

payment Accountant

Payment terms are entered in the

Accountant
system
Aging Report run on weekly basis
for all existing suppliers for Accountant Aging Report
payments
Based on this the, Payments are
Accountant
made and send for signatures
Bank
Bank payments vouchers made
Accountant payments
for approved invoices
vouchers
Finance
Cheques prepared, gives to FM
Manager &
for verified and signed by CEO
CEO
Payment delivered to the
suppliers and obtained the
Accountant
signatures in the copy of the
Cheque
Supplier payment can be steam
lined with Fixed dates- Accountant
Recommendation

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5D
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Activity :Bank Payments KPI:

Process Record
Input / Reference Process Sequence Responsibility
Step Generated

Travel Claims / Local Received from concern

Expanses Claim
Expanses (Above Personnel by Accountant in Accountant
Form
petty cash limits) Expanses Claim Form

Verify for Departments Head's Department

Authorization Head

Authorization for
Bank payments
With proper Authorization the
should be defined
Cheque been made and with Accountant
related to, Tickets,
approval it has been issued
purchases &
personnel, etc

Upon issue sign obtained from

the Receiver and handover of Accountant
Cheques

Activity Decision Review & Approval

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5E
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
To provide On-Time & correct payment
Activity :P.R. Activities Expenses KPI:
for P.R Activities
Process
Input / Reference Process Sequence Responsibility Record Generated
Step
Based on Petty cash
system, with P.R.O'S
Visa. P.R ( Govt. Payable
and all Bills are
Related ) Expenses Supervisor
provided by the Govt.
Related expanses

weekly basis inputs

given to Accounts Verified with the PRO
Payable
Payable and one week & Admin Coordinator
Supervisor
the payments been for payments
made

Books in the system

(ERP system ) for
payment and Payable
documents also Supervisor
forward to approval

Upon approval in the

Expenses claim
Payable Expenses Claim
preparation of Bank
Supervisor form
Payment Voucher for
payment transfers
Payable
Accounts being debited
Supervisor
Fixed limits for P.R.O
activate (300000 AED ) Payable
or less depending on supervisor
the country needs.
Activity Decision Review & Approval

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5F
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
To maintain the Reconciliation variation
Activity :Travel Expenses KPI:
< 5 AED
Process
Input / Reference Process Sequence Responsibility Record Generated
Step

Expenses claim form

from concern
CEO & Concern Expenses Claim
Personnel. Advance for
Dept. Head Form
traveling will be
approved by CEO only

Department Heads will Department

approve the same Head

Verify the vouchers Payable

attached in the claim Supervisor /GL Voucher
form Accountant
Any variations will be
clarified with Payable
department heads and Supervisor /GL Claim form
resolved prior to Accountant
payment
Upon approvals and
then the receivers
signature has been
Payable
obtained in the
Supervisor
Expenses Claim Form,
also all receipts are
attached with the same
All payments are made
as per SOP-5D (or)
SOP-5H
Activity Decision Review & Approval

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5G
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Make immediate payments for all
Activity :Utility Bill Payments KPI:
approved Bills
Process Record
Input / Reference Process Sequence Responsibility
Step Generated

DEWA, Telephone, Bills are received by Admin. Admin

Bills
Rent, etc Dept Coordinator

Admin. Verifies the bills for

Admin
misuse of the same and forward
Coordinator
to Accounts Department

Any variation /
misuses payments
will be agreed with Put it in the excel sheet for Utility Bill
Accountant
the concern by payment to be done Monitoring Sheet
Admin. and the info.
Passed to Accounts

Send to Finance Manager for Finance

this approval Manager

Cheques are prepared by the

accountant for the payments and
Payment
Bank Payment voucher made for Accountant
voucher
all cheques prepared prior to
issue
Issue the Cheques along with
Bills / to the concern DEWA / Accountant
Etisalat/ etc
Bills need to be
checked prior to
payment for any
personal calls for
Reconciliation to be
with Admin.

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5H
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Petty cash Management and control
Activity :Petty cash KPI:
related expesnses
Process Record
Input / Reference Process Sequence Responsibility
Step Generated

As per Petty Cash DOA - Chapter I General Expenses

Policy 1.9 “General Expenses paid by Petty Cash”
Link: Policies & flow chart www.axiomeasy.com

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Ver : 1.4 AT/F/PR 05 Date : 06/08

Document No:AT/F/SOP-5I
FINANCE MANUAL Issue No :01
Accounts Payables Revision No :00
Date :
Activity :Fixed Assets KPI:

Process Record
Input / Reference Process Sequence Responsibility
Step Generated

Approval by CEO / Concerned

LPO / Invoice along
Manager will be verified by
with Asset form given CEO Asset Form
Accountant. Limits for approval
to accounts
to be Fixed & documented

As per the credit terms agreed, the Admin.

payment process starts Manager

Along with invoice approval

Accountant Invoice
payments will be done

For work-in-progress
will be treated as
Fixed assets will be transferred in
supplier credit, upon Payable
system upon completion of
completion it will be Supervisor
payments
transferred to Fixed
Asset
Any warranty claims are maintained
by the concerned department and
Accountant Invoice
upon approvals from concern Dept.
only any payments will be made

No verification for approval of

invoices by the terms &
conditions agreed with suppliers

Prepare the analysis

of working progress Then the management does the
Payable
also to inform the Depreciation based on the fixed
Supervisor
concerned - dues
Recommendation

Activity Decision Review & Approval

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Ver : 1.4 AT/F/PR 05 Date : 06/08

6. Outputs
• Purchase order
• Supplier Reconciliation Report
• Invoice
• Payment voucher
• Reconciliation Report
• Aging Report

7. Monitoring and Measurement

Refer to Process Control Sheet

8. Forms and Records

Name Reference
Reconciliation Report
Purchase order
Creditors Ledger
Statements of Accounts
Supplier Reconciliation Report
Asset Form
Invoice
Utility Bill Monitoring Sheet
Payment voucher
Expenses Claim Form
Aging Report
Invoice
Purchase order

9. Interfaces
None

10. Process Tailoring

KSA
Process tailoring done
Roles specific to KSA are specified in BLUE colour

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