ACCOUNTS PAYABLE

Accounts Payable arise from the purchase of tangible goods.

(Inventories), services received, expenses incurred, acquisition of fixed assets or
investment hiring in process. If they are payable in a time shorter than twelve
months are recorded as Short-Term Accounts Payable and if their maturity is for a
time exceeding twelve months, in Long-Term Accounts Payable.
It is necessary to analyze these liabilities for each creditor and for each of these for each
origin document (date, document number, and amount) and for each payment
carried out; they should also be analyzed by age to avoid paying late fees or
compensations. Long-Term Payables at the end of each period
economic, they must be reclassified to Short Term.

PRINCIPLES AND PROCEDURES OF INTERNAL CONTROL

The amounts received and pending payment should be reconciled periodically according to
Accounting controls of the company and suppliers. Files must be prepared.
payment for suppliers of each invoice, its corresponding Report of
Reception (when applicable) and the check or payment reference, being canceled the
invoices with the stamp of 'Paid'. It is essential to keep the auxiliary ledgers up to date.
Accounts Payable, those of Accounts Payable Miscellaneous and not presenting balances
Aged. Accounts Payable to Suppliers and Miscellaneous must be itemized.
for each invoice received and each payment made; as well as by ages and analyzed by
The Management. Returns and claims made to pr

suppliers must be monitored to ensure that payments are made for what
actually received. Monthly, it must be verified that the sum of the balances of all
the major accounts payable auxiliaries match those of the accounts of
corresponding controls.

INTERNAL VERIFICATION PROCEDURES

Accounts Payable Short Term

Accounting summary of the outstanding items in the ledger for debtors. Verification of
the documents in the payment files for creditors (suppliers). Verify
if there are debit entries or balances (contrary to the nature of these
Accounts). Age analysis determining overdue debts (more than 30
days). Verify the signed payment agreements.
Various Accounts Payable

Analyze the items that make up the balance of this account, classify them according to their
content, checking its accounting balance as well as analyzing by ages for
determine the aged ones. Verify the supporting documents of the obligations
pending payments, as well as reconciliations, confirmations, and payment agreements.

Effects, Accounts and Long-Term Payables

Verify the accounting balance of the amounts and items that make up this account in each
one of the sub-accounts and auxiliary ledgers for creditors. Age analysis
checking that this account exclusively includes those that exceed a
year. Check the documents in the payment files (contracts, agreements,
etc). Verify confirmations and reconciliations with creditors. Analyze the
overdue and pending payment obligations, as well as debtor items
(contrary to the nature of this account).

DOCUMENTS TO BE PAID

In the same way as in sales, when the company requires the signing of promissory notes or bills of exchange.
of changing to customers to guarantee the payment of values on credit, likewise
when making purchases, suppliers will also require the signing of promissory notes or
promissory notes to ensure compliance with the payments of the values for
those who have granted us credit.

Bill of exchange

It is a written order from one person (drawer) to another (drawee) to make a payment.
a determined amount of money at a future time (determined or determinable)
a third party (beneficiary). The people involved are: The Drawer or issuer: Gives
the payment order and prepares the document. The Drawee: Accepts the payment order by signing
the document committing to pay. Therefore taking responsibility, indicating
in it, the place or payment address for the creditor to make their collection effective.
The Beneficiary or policyholder: Receives the sum of money at the specified time.
FUNDAMENTAL ASPECTS
Accounts Payable:

Accounts Payable arise from the purchase operations of tangible goods.

(Inventories), services received, expenses incurred and acquisition of fixed assets or
investment hiring in progress.

If they are payable in less than twelve months, they are recorded as Accounts Payable to
Short Term and if its maturity is more than twelve months, in Accounts Payable Long Term
deadline.

It is necessary to analyze these liabilities for each creditor and for each of them by
each source document (date, document number, and amount) and for each payment
performed. They should also be analyzed by age to avoid the payment of late fees or
compensations.

Long-term Accounts Payable at the end of each accounting period must

reclassify as Short Term, (the ones due next year).

PRINCIPLES AND PROCEDURES OF INTERNAL CONTROL

Accounts Payable

. The functions of receiving in the warehouse must be separated from authorization.

payment and signing of the check for its settlement.

. It is necessary to periodically reconcile the amounts received and pending of

payment according to accounting controls, with those of the suppliers.

. Payment Files must be prepared by suppliers containing each

Invoice, its corresponding Receipt Report (when applicable) and the
check or reference of the payment, canceling the Invoices with the stamp of
Paid.

. It is necessary to keep the Subaccount of Accounts Payable up to date.

Accounts Payable Various and not presenting aged balances.

. Accounts Payable to Suppliers and Various must be broken down by

each invoice received and each payment made; as well as by age and analyzed
by the Board of Directors.
 . Returns and claims made to suppliers must
to control oneself to ensure that payments are made for what is really
received.

. Monthly, it should be verified that the sum of the balances of all the
Subaccounts of Accounts Payable match those of the accounts of
corresponding controls.

INTERNAL VERIFICATION PROCEDURES

Short-term Accounts Payable.

. Accounting report of the pending items in the analytical subledger for

debtors.

. Verification of documents in the payment files by creditors

(suppliers).

. Check if there are any accounts or debtor balances (contrary to the nature of
these accounts).

. Age analysis determining overdue debts (more than 30 days).

. Verify the signed payment agreements.

Accounts Payable Various.

. Analyze the items that make up the balance of this account, classify them
according to its content, verifying its accounting balance as well as analyzing
by ages to determine the elderly (more than days).

. Verify the supporting documents of the outstanding payment obligations.

as well as reconciliations, confirmations, and payment agreements.

. Check that this account (Group) does not register the Countervalue in MN of the
operations in MLC that must be accounted for in the Counterpart account
Pending Payment in Current Assets.
 Effects, Accounts and Long-Term Payables.

. Verify the accounting alignment of the balances and items that make up this account in
Each of the sub-accounts and detailed sub-ledger for creditors.

. Age analysis checking that this account is included

exclusively those that exceed one year.

. Check the documents in the payment files (contracts, agreements,

etc).

. Check the reconciliations and confirmations with the creditors.

. Analyze the overdue and pending payment obligations, as well as the items.
debtors (contrary to the nature of this account).

APPLICABLE FINANCIAL REPORTING STANDARDS

The NIF C-9 of the CINIF establishes the specific application rules of
the financial reporting standards related to accounts payable
industrial and commercial companies.

THE VALUATION RULES

a) The debts that originate from the purchase of goods or

services arise at the moment of taking possession of the goods
to receive the services.

b) It is appropriate to record liabilities in favor of suppliers by deducting

commercial discounts, but without deducting the discounts for
quick payment.

Senior supplier assistants

A purchase of materials or goods on credit is recorded in

accounts payable to suppliers. The balance of this account is made up of the
total amount owed to all suppliers. The amount owed to a
private supplier can only be determined. To obtain this
information is kept in a separate record for each supplier.
These accounts receivable records of suppliers are classified in order
alphabetical in a larger called auxiliary account payable, or
Assistant supplier manager.
Supplier relationship

The total of all individual supplier account balances in the

The auxiliary ledger must be equal to the credit balance of the control account.
of suppliers in the general major.
Periodically, usually every month, a report should be prepared.
from suppliers, in order to verify the accuracy of the auxiliary ledger
suppliers. This total must match the balance of the control account
from suppliers.

Registration and accounting treatment of suppliers

In most companies, every time goods are purchased, a...

purchase order. There are different models of purchase orders.

Presentation and disclosure rules

a) It is important to present the debts in favor of separately

suppliers for the acquisition of goods or services that represent
the main activities of the company.
b) The significant debit balances that are part of the accounts
to pay suppliers, they should be reclassified as accounts payable
charge or as inventories, depending on their origin and the
final application that is estimated they will have.
c) Liabilities representing short-term bank financing
they must be presented separately.
CONCLUSION

We have come to the conclusion that inaccountingAn account payable is any

importindebted as a result of apurchasedand goodsor servicesin terms
of credit.

Althougha legal entitymake a purchase without issuing in writing the intention to

paymentregister in accounting,the amountindebted asa current obligationen
your accounts.Lthe companiesthey often incur in this type ofthe debitin the short term with
the end of funding hisinventories,especially inindustrieswhere isthe performance of
inventory is accelerated.