e-AP News
a short update on payment issues, news and products June 10, 2008

in this issue

Fuzzy Logic/Duplicate Payments

Excerpt: AP Segmentation: All Invoices Are Not Created Equal

More Reader Questions

Two More Things

Top Clicks from Last Week's ezine

In Closing


 

Dear Colleague

We've got lots of changes going on at Accounts Payable Now & Tomorrow-and I'm pleased to tell our readers they're all be good. For years, I've thought that I write books and articles but apparently that's not true, I'm told what I write is "content." I was given a set of criteria and asked to select a group of articles that will be added to our Web site.

That work has started and the content is being sprinkled throughout the site. And, before anyone asks, it is not all our articles but a selection to demonstrate what's in our print newsletter. Before we get started, a quick apology of the broken link for our Simple Ways to Improve AP Productivity on June 19th last week.


  • Fuzzy Logic/Duplicate Payments
  • Oh my goodness, did we get questions regarding the introduction of our new Top 100 Most Wanted Duplicates products. They broke down into two groups: the auditors wanted to know why we offer such a product and deprive them of some of the cream of their income while their potential customers wanted to know why the auditors wouldn't cap their recoveries at, say $10,000 per item. I'll address all these concerns on the AP Now blog for those who are interested; otherwise we could take up this entire e- zine. And, please, feel free to jump in on the blog and add your two cents.

    There was a slightly different question that may be of interest to many of our readers. The questioner thought that our use of the term "fuzzy logic" meant we were not using accepted analytical strategies. So I did a little research to try to provide a clearer description of what fuzzy logic is.

    The concept of fuzzy logic was conceived by University of California at Berkley professor, Lotfi Zadeh. It is a problem-solving control system methodology that lends itself to implementation in systems ranging from simple, small, embedded micro-controllers to large, networked, multi-channel PC or workstation- based data acquisition and control systems. The mathematicians would tell you that it is a way of processing data by allowing partial set membership rather than crisp set membership or non- membership.

    To put it in simple English, it is a complicated analytical tool used by those who know what they are doing (not me) to analyze data.

    For information about AP Now's Top 100 Most Wanted Duplicates
  • Excerpt: AP Segmentation: All Invoices Are Not Created Equal

  • Recently we mentioned the Spring marketing issue we mailed-which is different than our Spring Journal. We've got an excerpt from that issue for those who may not have received a copy. It was written by Anybill's Peter Bepler.

    Successful businesses understand the Pareto Principle, also known as the "80/20 rule" or the "law of the vital few." Yet when it comes to business operations in finance and accounting, most companies give little, if any, thought to this rule. In the case of accounts payable (AP), most businesses don't handle high-value invoices differently than routine payables-mainly because they don't recognize what invoices are high value or don't have a process to treat them with priority.

    Background

    Instead, the conventional thinking in payables processing is that an invoice is just an invoice, regardless of its possible impact on the bottom line. As a result, many organizations miss an important opportunity to minimize cost and maximize revenue. They don't focus on invoices that matter most, resulting in higher costs due to pricing errors, fraud, late penalties, and the inability to identify maverick spending. Handling all AP the same-the "big bucket" approach-creates a cascading effect that leads to:

    � Inadequate operational control,
    � Inefficient business processes,
    � And perhaps most critical, excessive transaction costs.

    There is a better way. AP Segmentation is an approach that involves separating and prioritizing invoices based on their type, characteristics and level of importance. AP Segmentation is also the process by which companies consistently identify "Critical AP" - the 20 percent of payables that are most strategic or problematic to the operation of the business.

    The rest of this fine article can be had by sending an email to publisher@ap-now.com with the words AP Segmentation in the subject line.

    Subscribe to Accounts Payable Now & Tomorrow
  • More Reader Questions
  • 1) We have a reader who is looking for some data that documents the entire process a company must go through to perform sales tax from beginning to remittance of returns. If anyone has this and is willing to share it, please send to publisher@ap-now.com. If we get several I'll combine them into a comprehensive document and share it with all who contribute.

    2) Three-way match questions and answers arising from a post on the AP-Now blog can be sent directly to marys@ap-now.com or posted on the blog. Again, all responses will be shared with all respondents. A reader in the healthcare industry whose company is considering the purchase of a new computer system asks, "According to the demos I have attended most of the work and verification is done in purchasing. This is going to be a big change for that department and for accounts payable.

    "I am wondering," she continues, "how other companies divide job duties and how they went about implementing procedures/systems the first time around. Right now in our company, purchasing places the order and receives the shipment. AP gets a copy of the PO and when the packing slip comes in purchasing verifies and codes what they know then passes it along to AP. I then verify what they have done and key it into the system. I correct any errors and hold items that are questionable until a manager can verify them."

    I responded that typically - and I use that word loosely - there are three parties involved. The receiving is not done in purchasing but in a separate receiving unit. I hope that the person purchasing is not the one receiving the goods and verifying the packing slip. If so that would be a serious slip in internal controls. The verification and matching of the three documents is almost always done in accounts payable. I also said I'd ask readers how they handled this issue.

    We're happy to try and get answers to reader questions. If you are reading someone else's copy of this publication and would like to receive your own, either send a note to publisher@ap-now.com or use the link below to register.

    Sign up for the AP Now ezine
  • Two More Things
  • I've really yammered on quite a bit this week. I just wanted to let you know that we've added a Special Offers page to ap-now.com, which we will use for - special offers. Typically these are offers that will run until we sell out. Right now we've put three of our special issue newsletters on there and are offering them for $9.95 each. Our Future of Accounts Payable publication is there also.

    On a totally different note, I'm quite excited because my daughter is coming tonight to visit and for the first time in our lives she is going to help me with a work project. I've been tasked with setting up Accounts Payable Now & Tomorrow on Facebook. I've done that but now have to get some friends. Right now, the only friend AP Now has on Facebook is Kathie Fitzgerald, our managing editor, and to be perfectly honest, I am not sure how that happened (and neither is she!).

    So, if you know what you're doing on Facebook, please friend us. My daughter tells me that's the right terminology. She also told me she's a pro at this and we will NOT be looking at her page-just what every mother wants to hear. I'll have more about both these ventures next week

    See AP Now's Special Offers
  • Top Clicks from Last Week's ezine
  • In Closing
  • Thanks for listening-really, if you stayed this long, a big thanks for listening to me blather on.

    Mary Schaeffer
    Accounts Payable Now & Tomorrow, a CRYSTALLUS, Inc. publication

    :: 302 836 0540

    Email Marketing by