Accounts Payable and Receivable Management: How to Run AP and AR Together

AP and AR usually live on the same running list: what’s ready to pay, what’s likely to be paid, and what needs a quick follow-up so the schedule holds. Keeping that list current is what makes payment runs predictable and follow-ups manageable.

This article outlines a practical way to run payables and receivables side by side, how invoices move through the queue, what’s worth reviewing during the week, and how teams keep status clear enough that timing decisions stay straightforward.

Accounts payable and receivable management

Accounts payable and receivable management is keeping two working lists clear enough that day-to-day decisions stay straightforward: invoices you’re planning to pay, and invoices you’re expecting to collect. The aim is to see what can move now, what’s already moving, and what needs one specific next step before timing can be locked in.

In practice, everything on both sides usually falls into one of three statuses:

• Ready: approved and clear to schedule (AP), or current and expected to pay on time (AR).
• In progress: moving through review, approval, or routine follow-up.
• Needs a next step: waiting on one specific item—an approval, receiving confirmation, a dispute owner, or a payment application detail.

From there, the work is consistent: schedule what’s ready, keep in-progress items moving, and route “needs a next step” to the right owner so it can move forward. A useful question to start with each time is: is this payable or collectible yet? That keeps attention on items that can actually move and makes follow-up more targeted.

How to manage accounts payable and receivable

Managing both functions starts with a working list you can actually run the week from. Most teams build that list the same way: start with what is due soon, then pull in anything that will miss timing unless someone acts.

On the AR side, that working set is usually made up of:

• invoices coming due that are likely to drift because they need a specific fix (wrong contact, missing customer-required references like a PO, missing backup)
• overdue invoices that are large enough to matter
• disputed invoices where the next step is resolution, not another reminder

Meanwhile, the accounts payable process is working through:

• invoices that need to land in the next payment run window
• invoices sitting in approval long enough that they won’t make the run unless they’re pushed
• invoices waiting on one missing input (PO reference, receiving confirmation, vendor setup, charge clarification)

What makes an invoice payable or collectible

An invoice becomes manageable when it’s clear whether it can move forward now or needs one more step first. On the payables side, that means knowing when an invoice can be scheduled with confidence. On the receivables side, it means knowing when an invoice is positioned to be paid without additional follow-up beyond routine reminders.

When an invoice is payable

An accounts payable invoice is payable when it can be included in a payment run without creating extra work before or after it goes out. In practice, that usually means:

• the vendor details are correct and usable for payment
• the invoice is complete and internally consistent (dates, quantities, totals)
• approval is finished and ownership is clear
• if the invoice is tied to a purchase order, what was billed aligns with what was ordered and received
• the invoice has been assigned to a specific payment run rather than sitting as “due soon”

At this point, payment timing becomes a scheduling decision rather than a question mark.

When an invoice is collectible

An accounts receivable invoice is collectible when it has entered the customer’s approval and payment process in a way that allows it to clear without rework. That usually means:

• the invoice was sent to the correct contact or submission channel
• customer-required references are included, such as PO or project codes
• supporting documents are attached if the customer expects them
• any open questions are clearly owned and moving toward resolution

When those conditions are met, follow-up is about timing and confirmation, not fixing the invoice itself.

Having this distinction in place keeps attention on invoices that can actually move and makes it easier to route the rest to the right next step.

How to manage payables and receivables week to week

Managing AP and AR side by side works best when the week runs on a simple rhythm: build the list that matters, move the items that are one step away from progressing, then schedule the week so timing stays clear.

Start by setting your working list. On AR, that’s invoices due or overdue that are ready for follow-up—sent to the right place, with the references the customer needs, and no open billing question holding approval. It also includes invoices where one action changes the outcome this week, like correcting routing, adding a missing PO or project code, or confirming the customer received the invoice.

On AP, the list is what should make the next payment run: invoices that are approved and schedulable, plus invoices that are one approval or confirmation away from being schedulable. If an invoice depends on PO context, keeping the difference between purchase orders and invoices clear makes validation consistent.

Separating invoice approval from purchase approval also keeps timing and controls clean. From there, the week is execution: push the approvals and confirmations needed to move items onto the schedule, run the payment batch, follow up on the receivables that  can realistically convert to cash, then update status so the next cycle starts clean.

How to know if your process is working

You know the AP/AR process is working when the two lists you run the week from are dependable.

On the payables side, that list is the next payment run. When you open it, you can see what is going out and why. Invoices on the run are approved and ready to pay. Invoices not on the run have a clear status that explains what happens next. They are either scheduled for a later run, sitting with an approver, or waiting on one confirmation such as receipt or PO context. When someone asks “when will this be paid,” you can answer using what you see on the list, either with a run date or with the exact next step needed before it can be scheduled.

On the receivables side, the list is the open invoice aging and this week’s follow-ups. When you look at the invoice workflow, you can tell which are expected to clear soon, which ones need a check-in, and which ones require a specific fix before payment can happen. Follow-ups have a reason attached to them. You are confirming the customer received the invoice, correcting routing, adding a missing reference like a PO or project code, or getting a billing decision resolved. You are not guessing what to do next.

If you can pick any invoice and immediately see what happens next and who owns that step, the process is doing its job. AP and AR runs off clear status, and the week becomes repeatable.

Next step: pull your next payment run list and your AR aging. Pick five invoices from each and make sure each one has two things: a next step and an owner. If you can do that in a few minutes, you’re in good shape. If you can’t, that’s the exact place to tighten the process.