Two weeks before the end of the financial year if

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Two weeks before the end of the financial year, if there are any purchase orders older than one month for which delivery has been received, but invoices have not yet been received, an Accounts Payable clerk sends out a request for invoice to the vendor. If an invoice is not received within two weeks, the PO is cancelled. If the item requested is not material goods, but a digital artefact or service, it is delivered directly to the employee who requested the item. In this case, there is no goods receipt form. Once the Accounts Payable clerk receives an invoice and matches it to a purchase order, he asks the employee to confirm that the artefact or service has been satisfactorily received. If so, the clerk can go ahead with payment. However, the ES has not been updated. The Accounts Payable clerk advises the Goods Receipt Department that the item has been received so they can update the ES. A goods receipt form is automatically generated and discarded. The employee can stipulate a time period, after which, if the item has not been received it would no longer be required. If the time period expires before the item has been ordered, the purchase requisition is cancelled and the employee is notified. If the time period expires after the item has been ordered but before it is received at the Goods Receipt Department, the purchase order is cancelled and both the vendor and the employee are
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notified. Otherwise, the goods are delivered as normal, even if the expiry time has elapsed before the employee receives the goods. Any invoice for which the PR has expired before goods have been received is just ignored. Key issues and Problems There are many issues and problems facing the current business process. Not always do both Financial Manager and Procurement Manager give approval. After one manager has rejected an application, the other one may still remain needlessly in the process until notice of the one’s rejection has arrived. For relatively inexpensive items, say under $100, the cost of managers administering the approvals tends to outweigh the cost of the items. However even for such items, the expense still needs to be independently authorised. Goods Receipt department has come under pressure to cut costs. Staff have now been cut to the bone. Most goods just pass through the department without change. Many defective goods are detected as unsatisfactory only after being received by the ordering employee. Except for very large items that cannot be sent through the internal mail, routing all deliveries through Goods Receipt department seems to add further delays to the process. Many vendors now offer Internet purchase with guaranteed Quality of Service. If purchased by electronic auction, prices are often better than in catalogues, however such purchases must be prepaid. All the employee needs is a credit card number from his Financial Manager. Can this option be implemented securely? When an employee calls in to query the status of their purchase order, the call is usually taken by one of the clerks in the Purchasing Department. Each purchase order has been logged in the ES, so he verifies the purchase order has been received from the employee.
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  • Fall '19
  • invoice, purchase requisition, Goods Receipt Department

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