Accounts Payable Certification Practice Test

What must be done if an approved payment is to be voided?

1. Notify the bank immediately.

2. Review the invoice details for accuracy.

3. Mark the invoice as invalid.

4. Ensure a stop payment order is placed.

The correct answer is: Ensure a stop payment order is placed.

When an approved payment is to be voided, it is essential to ensure that a stop payment order is placed. This action prevents the bank from processing the payment, thereby avoiding any potential financial loss. A stop payment is a formal request made to the bank, instructing them not to honor a specific check or electronic transfer. This process is critical because once a payment has been authorized, it may be in the processing stage or already distributed. Placing a stop payment protects the company's funds by halting any further transactions associated with that payment. Moreover, it allows the organization to review the reason for the voiding and take further actions if necessary, such as issuing a corrected payment or addressing any issues with the vendor. Immediate notification to the bank is vital, as delays could result in the payment being processed despite the intention to void it. The accuracy of the invoice details is important for record-keeping and should be handled as a separate task. Marking the invoice as invalid can help with internal tracking but does not directly address the financial transaction that needs to be stopped. Therefore, placing a stop payment order is the most prudent and necessary step in this scenario.