Our treasury department recommends we have AP handle wire transfers and ACH payments for payroll taxes and benefits. However, AP cannot handle the additional workload. Thoughts?


The question appears to be one of payment processing and resources. We are sorry we cannot lend a lot of support for AP refusing to handle wire payments. Best practice is for all payments to be centralized in AP—it eliminates an environment conducive to duplicate payments (payments going out of two different departments); and it ensures compliance with policy and procedures/internal controls. Treasury’s job being different than AP’s, it often fails to check all documentation for proper approvals, etc., things that are a matter of course for AP. (In fact, if your department does end up handling wires, watch out for end-runs to treasury to avoid following procedures.)

Also when wires are not handled in AP, depending on systems, it can cause additional steps to ensure that the system records all payments that have been made. But chances are with all payments centralized in AP, proper controls, including standard segregation of duties, are more likely to be in place and followed. There is not a strong case against AP handling wires. Some AP departments that do not handle wires wish they did.

If taking on wire payments presents a resource/workload issue, that’s the point to address. It is important to get wires right (they’re usually large dollar amounts and irreversible). Make the case that you must take the time required to adequately ensure that they are being handled correctly. Insufficient staff to allow for proper segregation of duties could be the kind of issue that you can use to point out the need for additional resources, i.e., you are unable to perform the function because it would violate the segregation-of-duties plan.

Consider building a solid business case, including a process map and metrics, outlining the details involved and the requirements (staff, equipment, protected space, bank authorizations, etc.) to ensure that AP can manage that piece of the business. This approach that will gain attention. And lobby for a pay hike, as you are managing at a higher level.  

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