Cloud Accounting for A&E Firms, Part 2: Accounts Payable

When you make a purchase for your business and you do not pay at the time of purchase, then you have an account payable, which is recorded in your books as a liability. An account payable is essentially a debt owed for goods or services received. It is important to manage accounts payable, to pay bills on time, manage cash flow, and maintain an accurate balance sheet. 

The best way to keep up with your accounts payable is to have a system.  The accounts payable system should integrate with your accounting software.  It should keep a record of when bills are due and whether they have been paid, in part or in full. In addition, it should provide a means to make payments, either by initiating an ACH payment, or by sending a check by mail.  And finally, your accounts payable system should support various user roles, including an ‘approver’ role and a separate ‘payer’ role, to support a clear separation of duties and reduce your risk of embezzlement.

At the time of this writing, one of the most popular and capable accounts payable management systems is provides support for all the necessary functions mentioned above.  Regarding the integration with your accounting software, there are certain functions that overlap (i.e., functions supported by both your accounting software and your accounts payable solution), and it is important to understand which software to use for specific functions. This will be addressed in the following concept of operations.

While this concept of operations is specific to and QuickBooks Online, the concept may be adapted to a different accounts payable management application or accounting software. You have an unpaid bill, which has already been posted to QuickBooks using your records management application.  Your account is integrated with your QuickBooks account, and the accounts are automatically synchronized once per day. The unpaid bill has been posted to through the synchronization process, and the unpaid bill shows up in an approval queue for you, as the approver.  You review the bill, and when you approve it for payment, it shows up in a list of bills to be paid.  Then, at the end of the week, your office assistant, who is identified as your payer, pays the bill, along with other bills that have been approved to pay.  Some of the bills are paid by ACH electronic transfer, and others are paid by check through the mail, depending upon whether each vendor has registered with to receive ACH payments. 

To make the payments for you, withdraws funds to cover the payments from a checking account that you have previously configured for making payments using  In addition, records the payment information, and the next time your and QuickBooks accounts are synchronized, the payments are posted to your accounting software.  Finally, when using with QuickBooks Online, it is very important to pay bills, or mark them as paid using  Although QuickBooks Online provides means to implement certain accounts payable functions, it is very important to perform them using, for the integration with QuickBooks Online to work as intended.