Account Payables – Bills – Definition and Use

What is an Account Payabale, specifically a Bill in SimpleManufacturing™?

A Bill is a statement of charges, typically from a supplier. An unpaid Bill is considered an Account Payable as it is a liability to the business.

Purpose of a Bill?

A Bill is used to identify a Payable, or in other words, the business’s liability to pay a 3rd Party, typically a supplier. For most Bills, businesses have established payment terms with Suppliers. Payment Terms will establish the date the Bill is expected to be paid. Having Bills added into SimpleManufacturing™ on a real-time basis, is necessary for cash-flow projections and to ensure suppliers are paid on time to eliminate disruption in their services.

What is a Recurring Bill?

Bills that are repeated on a specific frequency are considered recurring bills. Recurring bills include facility rent and company vehicle payments where the charges and due dates are known. Another example is a business loan. Adding Recurring Bills into SimpleManufacturing™ on a real-time basis is necessary for cash-flow projections.

How are Bills Created?

Bills are created within SimpleManufacturing™ manually through its Financial Management module or automatically through the Purchase Order receipt process.

Manual Creation of Bills

Bills can be created manually through the Accounts Payable section of its Financial Management module. The minimum information contained within a Bill consists of the following:

• Party which the monies are owed
• Date which the Bill is to be paid,
• Unique reference such as the Invoice Number provided by the Party’s invoice, and
• General Ledger Accounts.

SimpleManufacturing™ includes additional fields that can be used to help categorize Bills for ease of searching. Some of the additional fields are:

• Date of Bill
• Your Companies Account Number assigned by Vendor / Supplier
• Purchase Order Number
• Notes
• Reference Information

Copy a Bill

Want an quick and easy way to create a Bill?  Find an existing Bill with similar content, i.e. same supplier or vendor, and simply Copy it! Then just change the amount and due dates. Review the General Ledger Accounts along with the rest of its content.  Work Smarter, Not Harder!

Automatic Creation of Bills

Bills can be created automatically through the Accounts Payable section of its Financial Management module. Common instances for the Automatic creation of Bills are as follows:

Recurring Bills

Bills are automatically added during creation. Examples of Recurring Bills are repayments of loans. In most cases, the loan payment amounts are pre-set, as well as the date of payment due.

Purchase Order Receipt

Bills are automatically added during the Purchase Order receipt process. The Purchase Order receipt process should verify the product received against the product or service ordered. At a minimum, the product or service verification matches the product received, the packing slip, and the purchase order. A Bill is created for what was received. Each purchase order may result in several Bills based on the delivery times of the product or service ordered.

Purchase Orders contain all of the information necessary to create a Bill automatically:
Supplier / Vendor
Purchase Order No
Line Items of Product or Service
Product or Service Ordered
Unit Cost of Product or Service
General Ledger Accounts for the Product or Service received
Payment Terms

When the Invoice is received in Accounting, they verify the Bill Amount and the Payment Due Date and add the Invoice Number to the Bill. Simple, Effective, and Efficient!

Example of an Automated Bill from a Purchase Order receipt below with General Ledger Accounts shown.

Same Bill from a Purchase Order receipt below showing Purchase Order Line Item information.

Choosing SimpleManufacturing™ as your next ERP / MRP Business Software Solution

The ERP Software you choose now will determine your company’s success. Please pay particular attention to its scalability, current features, and ability to be modified to meet your future business needs. Our flexible approach, focusing on efficiency and seamless integration with your current processes, with the expectation of change, provides a long-lasting solution.