Internal Controls — Accounts Payable


  • All invoices processed for payment represent goods and services received and are accurate as to terms, quantities, prices and extensions; account distributions are accurate and agree with established account classifications.
  • All checks are prepared on the basis of adequate and approved documentation, compared with supporting data, and are properly approved and signed by authorized individuals, and mailed.
  • All disbursement, accounts payable and encumbrance transactions are promptly and accurately recorded as to payee and amount.
  • All entries to accounts payable, reserve for encumbrances, asset and expense accounts, and cash disbursements are properly accumulated, classified and summarized in the accounts.


  • Payment is more than optimum price.
  • Payment for materials or services is not received.
  • Discounts are not taken.
  • Damaged or missing goods are not reported.
  • Payment is based on improper price or terms.
  • Accounting distribution of cost is inaccurate.
  • Incorrect or duplicate payments are made.
  • Checks are altered.
  • Disbursement for materials or services is not properly documented or approved.
  • Cash, accounts payable and encumbrance balances are improperly recorded.
  • Internal finance data and financial statements are innacurate.