Using Accounts Payable

Vendors: Adding a VendorPerson or Corporation: Differences at a GlanceTo determine whether to define a vendor as a person or a corporation, you canevaluate a number of criteria, as presented in table 8. You can make these yourguiding principles in deciding whether to enter a given vendor as acorporation or a person:Table 8: Criteria That Determine if a Vendor is a Person or a CorporationCriterion Person CorporationType of tax ID number Social Security Number Employer Identification(SSN)Number (EIN) or NoneNature of organizationIndependent contractor orSole proprietorNon-personal entity1099/T4A reportability Usually 1099 reportable Usually not 1099reportableFormatted NamesA formatted name is a name that is formatted for a specific purpose. Ingeneral, you define a formatted name for a vendor if automated Colleagueprocesses (such as purchase orders, check runs, mailings, or formalcorrespondence) need to use their name in a format for which their standardcompany (or person) name is not appropriate.Colleague uses lists of name hierarchies (ordered lists) to select the propername formats to use on a specific report, check, purchase order, or otherdocument. Name hierarchies are maintained on the Name and AddressHierarchy (NAHM) form, accessed through Core Setup/Utilities. You can usethe Formatted Names (FNM) form to set up these formatted names for anyentity that has an ID in Colleague, including both corporate vendors andperson vendors.If a company uses an acronym for some purposes and spells out their name forothers, you might create a formatted name type so that the spelled out namecan be used when needed. Or, if a vendor you deal with is owned by acompany with a name different from the “DBA” name, the name you enter onyour checks to that vendor may be different from the name that is used forpurchase orders.54 Using Accounts Payable, June 19, 2009© 2009 Datatel, Inc.