Page 261 - Accounting Information Systems

232 PART II Transaction Cycles and Business Processes

inventory control, where the clerk files it with the open purchase requisition. One copy of the PO is sent
to AP for filing in the AP pending file. One copy (the blind copy) is sent to the receiving department,
where it is filed until the inventories arrive. The clerk files the last copy along with the purchase requisi-
tion in the open PO file.
Receiving

Goods arriving from the vendor are reconciled with the blind copy of the PO. Upon completion of the
physical count and inspection, the receiving clerk prepares a multipart receiving report stating the quan-
tity and condition of the inventories. One copy of the receiving report accompanies the physical invento-
ries to the storeroom. Another copy is sent to the purchasing department, where the purchasing clerk
reconciles it with the open PO. The clerk closes the open PO by filing the purchase requisition, the PO,
and the receiving report in the closed PO file.
A third copy of the receiving report is sent to inventory control where (assuming a standard cost sys-
tem) the inventory subsidiary ledger is updated. A fourth copy of the receiving report is sent to the AP
department, where it is filed in the AP pending file. The final copy of the receiving report is filed in the
receiving department.

AP Department
When the invoice arrives, the AP clerk reconciles the financial information with the documents in the
pending file, records the transaction in the purchases journal, and posts it to the supplier’s account in the
AP subsidiary ledger (voucher register). After recording the liability, the AP clerk transfers the source
documents (PO, receiving report, and invoice) to the open vouchers payable (APOK) file.
General Ledger Department
The general ledger department receives a journal voucher from the AP department and an account sum-
mary from inventory control. The general ledger clerk reconciles these and posts to the inventory and AP
control accounts. With this step, the purchases phase of the expenditure cycle is completed.

THE CASH DISBURSEMENTS SYSTEMS
A detailed system flowchart of a manual cash disbursements system is presented in Figure 5-13. The
tasks performed in each of the key processes are discussed in the following section.

AP Department
Each day, the AP clerk reviews the open vouchers payable (AP) file for items due and sends the vouchers
and supporting documents to the cash disbursements department.

Cash Disbursements Department
The cash disbursements clerk receives the voucher packets and reviews the documents for completeness
and clerical accuracy. For each disbursement, the clerk prepares a three-part check and records the check
number, dollar amount, voucher number, and other pertinent data in the check register.
The check, along with the supporting documents, goes to the cash disbursements department manager,
or treasurer, for his or her signature. The negotiable portion of the check is mailed to the supplier. The
clerk returns the voucher packet and check copy to the AP department and files one copy of the check.
Finally, the clerk summarizes the entries made to the check register and sends a journal voucher to the
general ledger department.

AP Department
Upon receipt of the voucher packet, the AP clerk removes the liability by recording the check number in
the voucher register and filing the voucher packet in the closed voucher file. Finally, the clerk sends an
AP summary to the general ledger department.