Pages

Search This Blog

Thursday, January 21, 2010

ATF (After-the-fact) Invoices

You might have heard about senior management in companies / finance dep / CFO shouting to reduce the number of ATF Invoices.
--What is an ATF invoice?
--How to control them?
--Different types of ATF invoices

In this post I would try to answer all of these,

1. What is an ATF Invoice?
ATF invoice stands for After the fact invoices which means any invoicing happens before related PO is created in other words where PO approval date is later than Invoice date.

2. ATF invoices can be controlled via a hold in Invoices. Generally companies name it as "ATF PO". Through this finance operations managers, controllers and all keep track of all these expenses. Payment through NON-PO / ATF-PO invoices are considered as bad finance management / planning and it hurts company's budget.

3. Although companies try their best to stop ATF Invoices but there are genuine instances wherein invoice lands in ATF. Reasons for that like there is some mistake happens in the original PO such as currency issue etc. and it is known only when invoice is received and in order to pay that invoice another new PO is created for paying the invoices. In that case the invoice becomes ATF because it is before the new PO is generated.

To keep track of such genuine instances following can be done,
Step 1. Create a DFF at PO header level to keep reference of the old PO number.
Step 2. Create a custom program and schedule it to remove the ATF hold automatically by checking if the new PO has DFF populated with the old PO and the old PO approval date is before the invoice date.

To make this process full-proof, a validation can be put in step 1 wherein requestor info would be mendatory in PO distribution level and a mail can be sent to the requetor when the new PO is approved to double check that the new PO is related to the OLD PO. This would eliminate any manual PO creation error / misuse of ATF PO creation.

I have custom script to remove the hold from AP invoices. Please mail me to get a copy of that.

No comments:

Post a Comment

Followers

Contributors