How to File Bills
By Laura Duggan
Bill paying is endless, yet it doesn’t end with paying the bill. You need to find the bill later one.
An efficient filing system is worth its weight in gold. There are so many reasons why you need to find a bill that has been paid. The vendor might dispute that you paid it. Or, you want to re-order the same item and can’t remember what it is. You are being audited and need to prove your expenses. On and on it goes.
We preface this discussion with a simple rule: keep paid and unpaid bills separate. All unpaid bills should be stored in their own folder, whether it is electronic or paper. Only after paying the bill will it be filed in the permanent system.
There are two ways to file bills: Paper, and Electronic. Each has their pros and cons.
The simplest system for filing paper bills is in an alphabetical, accordion folder. Here are some rules: • Buy a folder that has one pocket for every letter of the alphabet. Consolidating letters such as H/I make it very hard later to find what you want • Use the first letter of the last name for each vendor or consultant. If a company has a list of names, use only the first. • File with either the most recent, or the most recent last. It doesn’t matter which, as long as you are consistent. • For vendors that have a huge number of bills they send you, consider using a separate folder or binder. • For multiple-page bills, staple the pages together. This makes searching the folder much easier. • Start a new folder every year.
If you are paying bills with manual checks, it is helpful to attach a copy of the check to the bill when filing it.
Before filing, always mark the top of the bill with the date paid, and a Check Mark, or stamp that says Paid. If you are attaching the check, no need to put the check number. If you paid electronically, mark “Paid Electronically” so that you can track the bill online.
An alternative to filing the papers, or, as a supplement, you can create an electronic file of your bills. This is particularly useful when you are receiving bills electronically, or as a mixture of electronic and paper.
In this case, you will need one extra step, which is to scan the paper bills into a PDF file, so that all your bills are now electronic.
Then you have two choices. One is to create a folder on your company computer system that is accessible by everyone who needs it. The files then can be stored by year into separate directories. Always name the file with the name of the vendor. In this way, you can easily sort alphabetically. If possible, create a descriptive name that also tells you a bit more about the invoice itself. If you have paid with a manual check, scan the check in as well and keep it in the file. Also mark the top with date paid.
Another option is to use a Web-based document storage system. Benefits are that you don’t have to worry about the back-up issues, and the access issues. You can give access to the storage system to all those who need it, including CFO and accounting staff. The systems often have fairly large capacities as well. The naming conventions listed above still apply.
Some systems to consider:
For a review of other on-line storage system, see ReadWriteWeb.com