Accounts Payable

Invoice Processing

As fiscal year end approaches, it is important to clarify the procedures that we follow in processing invoices at the end of the year. The INVOICE DATE is used to determine which fiscal year that invoice is charged against regardless of the year of the PO creation. The invoice date is the date presented on the first page of an invoice submitted by the supplier.

All invoices received by AP by end of day July 10 with an invoice date of June 30 or before will be processed in the Fiscal Year 2020. Invoices dated July 1st or later will be processed in the Fiscal Year 2021.

A reminder for subscription and membership payments:

  • Subscriptions should be processed via check request or procurement card (unless they require a contract signature or are software subscriptions). The billing notice is typically generated through a renewal reminder rather than through an invoice; therefore, a check request or procurement card is the appropriate method for payment.
  • Memberships should be processed via check request or procurement card if the membership does not require an agreement or ongoing services/data access (such as Cloud services) which would require a security review. 

Additional information on PCard Usage can be found at: https://purchasing.iu.edu/pcard/general.php

Goods, or merchandise, are rarely pre-billed. If you order equipment or supplies in the month of June and ask for a delivery of July 1 or later, the vendor may ship your product early and issue an invoice on the date shipped. In this case, the invoice will be processed in FY20. Please keep this in mind when placing orders for products that you do not wish to take delivery of until after the fiscal year end.

Funding Recurring Purchase Orders:

At times throughout the year, but especially at fiscal year-end, recurring Purchase Orders (POs) could run out of encumbered funds. You must encumber funds for all billing expected to be paid on your recurring order through the end of the fiscal period so that payment processing is not delayed.

Invoices received against unfunded POs will result in payment delays. The practical result of the recurring Purchase Orders being unfunded is:

  1. Multiple communication occurs between the Department and Purchasing; and
  2. Supplier’s payment is delayed.

To avoid these consequences, please review all recurring POs to ensure funds are available.

Purchase Order encumbrance clean up

Purchase orders in BUY.IU should remain open until billing is received and payments have been processed. To manage your open BuyIU POs:

  1. Request billing by July 1st so payment can be made within the appropriate fiscal year.
  2. Do not close a PO upon receipt of goods. The PO must remain open in order to pay the bill.
  3. If the PO is completely paid and no additional payment processing is expected, then close the PO to release any remaining encumbrance.

Guide to Accounts Payable Liability Object Code 9045

Accounts Payable object code 9045 is the offset object code for invoice expenses, credit memo credits, and cash disbursements. You may monitor AP liabilities in the KFS GL Balance Lookup.