Tips for improving your vendor management process
by Laura Haffner, CPA, director, and Rene Larsen, director, FORVIS
To succeed, it’s critical for a nonprofit to create and maintain accurate vendor information. From setting up a new vendor to a periodic review of vendors, each step in the vendor life cycle helps to keep an accurate and concise vendor list.
Setting up new vendors
Prior to setting up a new vendor, make sure you have the needed documents. The most important document you should obtain is a signed W-9 form, and you should withhold any payment until receiving it. Other documents you may receive are a signed vendor agreement or contract and any special payment instructions, such as an Automated Clearing House (ACH) form with banking information. Some organizations have a form that they send to new vendors to fill out ACH information.
After all documents have been received, verify that the vendor is a legitimate business. This could be done through a public database search, such as the Secretary of State website. Then, enter the new vendor into the bill pay software (whether that’s the accounting software or another vendor management software).