Accounts Payable

Accounts payable is a working capital and fraud-prevention discipline. Managing payables requires strict three-way matching (purchase order, receiving report, vendor invoice), clear segregation of payment approval duties, and structured disbursement schedules across both traditional banking and modern digital/stablecoin rails.

1. The Three-Way Matching Protocol

Never disburse funds based on an isolated invoice. Validate three core documents before payment approval:

1. Purchase Order (PO): Validates that the purchase was authorized with approved unit pricing.
2. Receiving Report / Goods Receipt: Confirms that goods or services were delivered and accepted.
3. Vendor Invoice: Verifies that billed quantities and rates match the PO and delivery receipt within a tight tolerance (typically <1% variance).

2. Payment Approval Matrix & Segregation of Duties

Prevent unauthorized disbursements through tiered approval thresholds:

• Level 1 (Tier 1: < $2,500): Department manager approval.
• Level 2 (Tier 2: $2,500 – $25,000): Department head + Financial Controller approval.
• Level 3 (Tier 3: > $25,000): Chief Financial Officer (CFO) or CEO co-signature required.
• Segregation of Duties Rule: The person who enters a vendor into the ERP/accounting system must never have banking disbursement or check-signing authority.