R2R, C2C, P2P - Explained

R2R, C2C, and P2P are different types of accounting processes, which stand for:

1. R2R (Record to Report): R2R is an accounting process that involves recording financial transactions in a company's general ledger and preparing financial statements. It includes activities such as journal entry posting, account reconciliation, and financial reporting.
2. C2C (Cash to Cash): C2C is an accounting process that focuses on the entire cash flow cycle of a company, from the time cash is received to the time it is disbursed. It includes activities such as cash receipt, deposit, disbursement, and reconciliation.
3. P2P (Procure to Pay): P2P is an accounting process that involves the entire cycle of purchasing goods or services, from identifying the need for the item to paying the vendor for it. It includes activities such as requisitioning, purchasing, receiving, and paying for goods or services.

All three processes are critical for a company's financial management and control and are interdependent. Accurate recording of financial transactions (R2R) ensures that the cash flow (C2C) and procurement (P2P) processes are properly tracked and controlled.

List of activities under R2R:

The R2R (Record to Report) process is a critical accounting process that involves the following activities:

1. Journal Entry Posting: Recording financial transactions in the general ledger by creating journal entries.
2. Accounts Reconciliation: Ensuring that the balances of all accounts in the general ledger match the corresponding balances in the subsidiary ledger or supporting documentation.
3. Financial Reporting: Preparing financial statements such as the balance sheet, income statement, and cash flow statement, which provide insights into the financial performance and position of the company.
4. Fixed Asset Accounting: Recording and tracking the company's fixed assets, including acquisition, depreciation, and disposal.
5. Intercompany Accounting: Ensuring that financial transactions between different legal entities within the same company are properly recorded and eliminated in the consolidated financial statements.
6. Month-end Closing: The process of closing the books at the end of the month, which involves performing various reconciliations, adjusting journal entries, and preparing financial statements.
7. Financial Analysis: Analyzing financial data to identify trends, variances, and opportunities for improvement.
8. Compliance and Audit: Ensuring that financial records and reporting comply with applicable accounting standards, regulations, and laws and preparing for audits by internal and external auditors.
9. General Ledger Maintenance: Maintaining the integrity and accuracy of the general ledger, including managing chart of accounts, opening and closing periods, and posting rules.

List of activities under C2C:

The C2C (Cash to Cash) process is a critical accounting process that involves the following activities:

1. Cash Receipts: Collecting and recording cash received from customers, including checks, cash, wire transfers, and credit card payments.
2. Bank Reconciliation: Ensuring that the company's bank account balance matches the corresponding balance in the company's records by reconciling bank statements and accounting records.
3. Accounts Receivable Management: Managing customer accounts and ensuring timely and accurate invoicing and collections.
4. Cash Forecasting: Predicting future cash flows to ensure that the company has sufficient cash on hand to meet its obligations.
5. Cash Disbursement: Paying vendors and suppliers for goods and services received by the company.
6. Accounts Payable Management: Managing vendor accounts and ensuring timely and accurate payment of invoices.
7. Petty Cash Management: Managing small cash disbursements for day-to-day expenses such as office supplies, postage, and employee travel.
8. Credit Management: Evaluating the creditworthiness of customers and establishing credit policies to manage the risk of non-payment.
9. Treasury Management: Managing the company's cash and investments to ensure maximum return on investment while maintaining adequate liquidity.

List of activities under P2P:

The P2P (Procure to Pay) process is a critical accounting process that involves the following activities:

1. Purchase Requisition: Identifying the need for goods or services and creating a purchase requisition.
2. Vendor Selection: Evaluating and selecting vendors based on criteria such as price, quality, delivery time, and vendor reputation.
3. Purchase Order: Creating a purchase order that specifies the goods or services to be acquired, the price, and the delivery terms.
4. Goods Receipt: Receiving and recording the goods or services received from the vendor.
5. Invoice Processing: Verifying that the goods or services received match the purchase order and processing the vendor's invoice for payment.
6. Payment Processing: Authorizing and making payment to the vendor according to the agreed-upon payment terms.
7. Accounts Payable Management: Managing vendor accounts and ensuring timely and accurate payment of invoices.
8. Expense Management: Managing employee expenses, including travel and entertainment expenses, and ensuring compliance with company policies and procedures.
9. Inventory Management: Managing inventory levels and ensuring that the company has sufficient inventory to meet customer demand without overstocking.