Managing Bills & Accounts Payable

Bills in NP Ledger represent money your organization owes to vendors but has not yet paid. Recording bills separately from payments gives you a clear picture of your outstanding obligations and produces accrual-basis accounting entries -- the standard required by GAAP for most nonprofits.

If your organization pays vendors on terms (Net 30, Net 60, etc.), you need to track what you owe before writing the check. Recording a bill creates an Accounts Payable liability on your balance sheet, which:

• Shows your true financial position (not just what is in the bank)
• Lets treasurers and bookkeepers answer "what bills are due this week?"
• Supports accrual-basis reporting required by GAAP and most auditors
• Creates a clean audit trail linking invoices to payments

Accountant note: Approving a bill posts a journal entry (DR Expense, CR Accounts Payable). Paying a bill posts a second journal entry (DR Accounts Payable, CR Bank). This two-step process is standard accrual accounting. If your organization uses cash-basis accounting, you can skip bill tracking and use the "I paid a bill" Quick Entry action instead, which records the expense and payment in a single step.

• Your organization must be on a Standard or Professional plan (bill tracking is not available on Starter)
• You need the Owner, Admin, or Accountant role
• At least one vendor contact in your contact list (you can create one on the fly)
• At least one expense account in your chart of accounts

From the Bills Page

1. Go to Bills in the sidebar (under Transactions).
2. Click New Bill.
3. Fill in the header: vendor, bill date, due date, payment terms, and an optional memo.
4. Add one or more line items. Each line needs:
5. Expense account -- what type of expense this is
6. Fund -- which budget this comes from
7. Amount
8. Purpose (functional class) -- Program, Management, or Fundraising (required for expense accounts)
9. Click Save to create a draft bill.

From Quick Entry

1. Go to Quick Entry and select "I received a bill."
2. Enter the vendor, amount, due date, expense account, fund, and purpose.
3. Submit to create a single-line draft bill.

Using Voice Entry

Say something like: "I received a bill from ABC Consulting for $3,000, net 30, for program evaluation services." Voice Entry will recognize the bill and pre-fill the Quick Entry form.

A draft bill is just a record -- it does not affect your books yet. To post the accounting entries:

1. Open the bill from the Bills list.
2. Review the line items and amounts.
3. Click Approve.

Approving posts a journal entry: - Debit each expense account (for the line item amounts) - Credit Accounts Payable (for the bill total)

The bill status changes from Draft to Approved.

Tip: NP Ledger auto-creates an "Accounts Payable" liability account the first time you approve a bill, so you do not need to set one up manually.

From the Bill Detail Page

1. Open the bill and click Record Payment.
2. Select the bank account you are paying from.
3. Enter the payment amount (defaults to the remaining balance).
4. Optionally add a payment method and reference/check number.
5. Click Record Payment.

From Quick Entry

1. Go to Quick Entry and select "I paid a bill."
2. Select the vendor. If unpaid bills exist for that vendor, they appear below the vendor dropdown.
3. Select the bill you are paying. The amount auto-fills to the remaining balance.
4. Adjust the amount if making a partial payment.
5. Submit.

Partial Payments

You can pay a bill in installments. Each payment: - Posts a journal entry (DR Accounts Payable, CR Bank) - Updates the bill's paid amount - Changes the status to Partially Paid - Appears in the payment history on the bill detail page

When the total paid equals the bill amount, the status changes to Paid.

• Draft bills can be voided at any time (no accounting impact).
• Approved bills (with no payments) can be voided. This creates a reversing journal entry that removes the AP liability.
• Partially paid or fully paid bills cannot be voided directly. Reverse the individual payments first.

The AP Aging report shows all unpaid bills grouped by how long they have been outstanding:

Access it from Reports > AP Aging. You can filter by vendor and fund, and export to CSV or PDF.

Bills are included in your organization's data export (Settings > Data Export). The bills.csv file contains bill headers, line items, and payment history.