• Version 1.0

• Prepared by: @Lorraine Sebata

• Approved by: @Marcia Wilkinson

• Reviewed date: 2025-09-13

• Next review date: 2026-09-12

1. Purpose

This SOP details the step-by-step process for reviewing and updating contact groups within the Accounts Payable function at Easyterms. The purpose of this review is to ensure accuracy, completeness, and timeliness in the processing of financial obligations owed by the business. Regular reviews involve verifying that invoices are properly recorded, approved, and paid according to agreed terms, and that all contacts are appropriately categorized for efficient management.

2. Scope

This SOP applies to all Accounting Staff involved in the processing, verification, and payment of bills. Specifically, it outlines the systematic process by which bills are processed, verified, and paid, focusing on the categorization of contacts in the accounting software (Xero). A member of the Accounting Staff enters bills into Xero upon receipt, and another approves same for payment processing.

3. Related Policies

• Data Entry and Verification Policy

4. Roles and Responsibilities

• Accounting Staff (Bill Entry): Responsible for accurately entering bills into Xero upon receipt.

• Accounting Staff (Bill Approval/Review): Responsible for approving bills for payment processing and conducting the review of Accounts Payable reports, including assigning contacts to groups.

5. Procedure: Payables Review & Update Groups

5.1 Access Accounts Payables Report

• 5.1.1 Log in to the accounting software (Xero).

• 5.1.2 Navigate to the 'Reports' section.

• 5.1.3 Select and open the Aged Payables Summary - Grouped Custom Report.

5.2 Review Report for Ungrouped Contacts

• 5.2.1 Carefully review the Aged Payables Summary - Grouped Custom report.

• 5.2.2 Identify any contacts that are not assigned to a group or are assigned to an incorrect group.

5.3 Assign Ungrouped Contacts to Groups

• 5.3.1 For each identified ungrouped contact, determine the most appropriate group(s) based on the nature of their services or goods provided to Easyterms.

  • Note: Contacts can exist in more than one group if applicable (e.g., a vendor providing both IT services and office supplies might be in "IT Vendors" and "Office Supplies Vendors").

• 5.3.2 Navigate to the 'Contacts' section in Xero.

• 5.3.3 Search for the specific contact.

• 5.3.4 Edit the contact details and assign them to the determined group(s), e.g. auto dealers, customer payments and employees, etc.

• 5.3.5 Save the changes to the contact.

5.4 Verify Group Assignments

• 5.4.1 After assigning all identified contacts to groups, re-access the Aged Payables Summary - Grouped Custom Report.

• 5.4.2 Review the report again to ensure that all contacts are now correctly assigned to at least one group.

• 5.4.3 Confirm that the grouping accurately reflects the categorization of payables.

6. Documentation and Records

• Xero 'Aged Payables Summary - Grouped' reports (before and after updates)

• Internal notes or logs of contacts updated (if necessary for audit trail)

• Xero contact records reflecting group assignments

7. Training

All Accounting Staff involved in Accounts Payable processing will receive mandatory training on this SOP and related policies annually or upon significant revisions. Training will include specific guidance on utilizing Xero's contact grouping features.

8. Review and Revision

This SOP will be reviewed annually by the Finance Department to ensure its continued effectiveness, compliance, and alignment with business objectives. Any changes to Xero's functionality related to contact grouping will trigger an immediate review and potential revision of this SOP.