Accounting Posting Errors Investigationnn Essay

Submitted By Fatimehin
Words: 505
Pages: 3

Memorandum
The Boyd Group Incorporated

Date: January 22, 2013

To: Pat Grierson Corporate Controller

Cc: J.P. Marker CM1 Marker

From: Ebenezer Fatimehin Account Payable Associate

Subject: Research proposal into Account Payable Transaction Posting Errors

During the last staff interactive session, the Chief Executive mentioned the reaction of our vendors towards their payment and proper management of accounts payable of our newly acquired repair shop center. This memo proposes an investigation into the reasons why account payable transaction posting errors occur In hopes of finding a way to reduce or minimize the problem; I have detailed the proposed research strategies below, and if you approve, I will begin on the investigation as soon as possible.

Background:

As you know, 60% of our operations are run on credit through the credit facilities given to us by vendors. The account payable turnover report shows 20% drop at the rate of paying our vendors. Since getting vehicle parts on credit from vendors constitute a large part of our service to customer, I have decided to review ways of posting the vendors account with minimal or no error.

Problem, Scope, and Significance:

Having worked for nearly one year in this organization, I have noticed the problem of late payment to vendors due to long hours reconciling vendors account due to wrong posting from the repair shop location. Unfortunately, delay in paying vendors sometime leads to some vendors withdrawing their credit facilities from us by placing us on cash on delivery which is not good for our operation.

As you are aware, the increasing number of our repair shops help in solidifying our leadership in auto body collision repair business. We must guide against wrong posting and work toward standardization of our management accounting information system across all our repair shop location, to enhanced operational and administrative efficiency.

Proposed