AP is a timing decision

Every bill you receive is a choice about when to part with cash. Pay too early and you give up float; pay too late and you incur fees and damage vendor relationships. Good AP is disciplined timing.

The three-way match

Before any invoice gets approved, match it against:

  1. The purchase order — did we agree to buy this?
  2. The receiving record — did we actually get it?
  3. The invoice — does the amount match?

If all three agree, approve. If they don't, route to the buyer. The three-way match is the single best defense against overbilling and duplicate-payment fraud.

Capture early-payment discounts

A 2/10 Net 30 term is a 36% annualized return on the cash you'd otherwise hold for 20 extra days. If you have the liquidity, taking the discount almost always beats keeping the float. Flag discount-eligible bills automatically and pay them on day 10 — not day 1, not day 11.

Schedule, don't scramble

  • Batch payments weekly. A single weekly payment run beats ad-hoc check writing for control and cash visibility.
  • Pay on the due date, not before. Unless a discount applies, holding cash to the last responsible moment is free working capital.
  • Set reminders for discount windows so you never miss a 2/10 by a day.

Guard against duplicate and fraudulent payments

Require a second approver for anything over a threshold, lock vendor banking details behind a change-verification step (call the vendor on a known number), and reconcile the AP ledger to bank activity monthly. Most AP fraud is a changed wire instruction that nobody verified.