Most descriptions of an account payable process flow assume a department: a clerk, a supervisor, an approver, somebody separate running the payment. In a business closing one set of books that department is often one person and sometimes half of one, and the standard flow does not survive contact with that reality. What is worth knowing is which parts of the flow are load-bearing when there are two of you, and which are ceremony inherited from a larger organisation. This page is the small-team version: the minimum flow, the one control that cannot be dropped, and what to do about segregation of duties when there is nobody to segregate from.
The minimum flow that still works
Invoice arrives against a supplier with a date. It is coded and matched to whatever exists, an order or a commitment. It is approved by the person who committed the spend, who is not the person entering it. It is posted and paid in a batch. Five steps, and the fourth is the one that matters.
The control that cannot be dropped
Somebody other than the person entering the invoice has to approve the spend. Everything else in payables can be compressed; that separation is the difference between a process and an honour system, and it is the first thing an auditor or an insurer will ask about.
Segregation of duties when there is nobody to segregate from
Small teams cannot fully separate entry, approval and payment, and pretending otherwise is worse than admitting it. The usual answer is a compensating control: an owner or director reviews the payment run and new suppliers before release. It is not as strong, it is honest, and it can be evidenced.
Questions people ask about account payable process flow
Is a one-person payables function acceptable?
It is common and it carries a known risk, which is why the compensating review exists. What is not acceptable is a one-person function where nobody outside it ever looks at the payment run.
Do we need purchase orders?
Not necessarily, but you need some record of who committed the spend before the invoice arrived. In a small team an email approving the quote can serve, provided it is kept with the invoice.
When does this stop working?
Usually somewhere around fifty invoices a month, when holding the exceptions in your head stops being possible and the first missed cut-off happens.