SAP S/4 HANA’s Accounts Payable module allows management of vendor invoices and down payments within the Procure-to-Pay (P2P) process.
This business process design (BPD) document outlines the end-to-end processes for handling vendor invoices and down payments, ensuring that businesses can efficiently manage both regular and advance vendor payments, improving financial transparency and operational efficiency.
Following processes are covered in this document with in-depth description and Visio flowcharts:
1. Process Vendor Invoices and Payments
The Vendor Invoices and Payments process automates and simplifies the management of vendor invoices from posting to payment and reconciliation. Key steps in this process include:
- Invoice Posting: Ensures that vendor invoices are accurately recorded in the system, updating key financial accounts.
- Payment Processing: Involves manual or automatic methods for processing vendor open items, allowing businesses to manage cash flow effectively.
- Bank Reconciliation: The system enables both manual and automatic reconciliation of payments with the bank statement, ensuring that all financial transactions are aligned with actual cash flows.
This process ensures a streamlined flow from invoice receipt to payment clearance, enhancing overall financial control and supplier relationship management.
2. Process Vendor Down Payment
The Vendor Down Payment process covers the handling of advance payments to vendors before the delivery of goods or services. It ensures that down payments are managed systematically, from request creation through to payment execution and final reconciliation. Key steps include:
- Down Payment Request Creation: The process starts with the creation and approval of a down payment request, ensuring that business requirements are met before the payment is processed.
- Manual and Automatic Payments: Similar to invoice payments, down payments can be processed manually or automatically, with options for scheduled payment runs.
- Reconciliation: After payment, the down payment is reconciled with vendor invoices, ensuring that advance payments are cleared and reflected accurately in financial records.
This process enhances cash flow management and provides a systematic approach for managing vendor advances.