KnowledgeLeader Blog

The accounts payable process is all about how a company pays its bills. For most companies, accounts payable begins with receiving an invoice and ends with issuing payment to the supplier. Usually companies pay invoices on a daily, weekly, or semimonthly basis. In addition to paying invoices, the accounts payable group typically has responsibility for managing accounting policies that affect supplier relationships and cash management.

Companies generally follow a standard set of activities for processing an invoice for payment. The accounts payable staff:

How many directors can name a chief risk officer who has advised them and the executive team that the organization is too risk-averse? In the digital age, not enough.

It has always been understood that one must take risks to grow. And typically, the more risk one takes, the higher the potential return. Conversely, a risk-averse mindset leads to a lower return. Given the pace of change in the digital age, the reality is such that it’s not just a matter of taking risk to grow or generate greater returns — it’s also a matter of survival. That’s why organizations might have to undertake more risk than they may be accustomed to taking if they are to survive.

Sustaining an effective business model in the face of digital disruption requires a strong foundation of IT governance able to scale and adapt to modern enterprise needs. These needs, though unique to each enterprise, are generally shaped into four key drivers — innovation, meeting customer expectations, data-based decision making and improving business performance — and enabled by a convergence of technologies such as cloud and mobile, social apps, the internet of things (IoT), artificial intelligence (AI), and robotic process automation (RPA).

The process of purchasing materials and supplies comprises procedures and activities to acquire goods in the correct quantity and in a timely manner. The process should include how purchases are started (e.g., inventory levels), who is involved and how it is made. In addition, the process covers the communication of purchases to all required areas of the company (e.g., accounting). Inventory management follows and starts from the time inventory purchases are received to the time the inventory is sold to the customer and payment is received.

The digital revolution currently taking place is transforming our world. Over the next few years, many organizations will need to undertake radical change programs and, in some cases, completely reinvent themselves to remain relevant and competitive.

In a world of rapid change on almost every front at which organizations must adapt and grow or risk decline and their ultimate demise, everybody faces the same reality — either continuously improve their efforts to contribute sustainable value or be left behind. The chief audit executive (CAE) is no exception. As the risks and complexities companies face change, so do the focus, skill sets and capabilities needed by internal audit.

Many auditors are asking themselves the same legitimate question: With so much happening, where do we start?  Advancements in technology and data have been so rapid in recent years that long-standing organizations that failed to pay attention have been disrupted and displaced by so-called “born-digital” competitors. In the case of many organizations who met their fate at the hands of born-digital competitors, it was often a lack of activity – or, at least, a lack of the right activity, at the right pace – that allowed for the rise of the disruptors and led to the demise of the disrupted. It is not hyperbolic to suggest that digital risk is an existential risk for many organizations if ignored.