APS Exam Dumps - Accredited Payables Specialist (APS) Certification Exam

TheTax and Regulatory Compliancetopic in the APS Certification Program covers sales and use taxes, which are imposed on the sale or use of goods and services. In the U.S., sales and use taxes are levied bystatesand, in many cases,cities and towns(local jurisdictions). Thefederal governmentdoes not impose sales or use taxes, as this authority is reserved for state and local governments.

Item I (Cities and towns): Many cities and towns impose local sales taxes, often in addition to state taxes, to fund municipal services. This is a valid taxing authority.

Item II (Federal government): The federal government does not levy sales or use taxes; it imposes taxes like income or excise taxes. This is not a valid taxing authority for sales and use taxes.

Item III (States): States are the primary authorities for sales and use taxes, setting rates and rules for taxable transactions. This is a valid taxing authority.

Option A (II and III only): Incorrect, as Item II is not a valid taxing authority.

Option B (III only): Incorrect, as Item I is also a valid taxing authority.

Option C (I and III only): Correct, as only states and local jurisdictions (cities and towns) levy sales and use taxes.

Option D (I, II, and III): Incorrect, as Item II is not a valid taxing authority.

Reference to IOFM APS Documents: The APS e-textbook underTax and Regulatory Compliancestates, “Sales and use taxes are levied by states and local jurisdictions, such as cities and towns, but not by the federal government.” The training video discusses AP’s role in managing sales tax compliance, noting that “states and local governments set sales tax rates, while the federal government does not impose such taxes.”

Evaluated Receipt Settlement (ERS) is a payment process that eliminates the need for a supplier invoice by triggering payments based on the purchase order (PO) and receiving documents. The quantity of goods received, as confirmed by the receiving documents (e.g., goods received note or delivery receipt), determines the payment amount, ensuring that payments reflect only what was actually delivered.

The web source from Esker states: “Evaluated Receipt Settlement (ERS) is a procedure for paying suppliers without requiring a paper invoice from the supplier… Payments are triggered by the receipt of goods or services against a purchase order.” The Corcentric source further clarifies: “ERS uses the PO to establish the agreed-upon price and quantity, but the actual payment is based on the quantity received, as verified by the receiving documents.” This confirms that the receiving documents provide the critical data on the quantity delivered, which drives the ERS payment.

Supplier Invoice (A)is incorrect, as ERS eliminates the need for invoices.

Purchase Order (B)specifies the ordered quantity and price but does not confirm actualreceipt.

Advanced Shipping Notice (D)provides pre-delivery information but is not the final confirmation of received goods.

The IOFM APS Certification Program covers “Payments,” including ERS as a streamlined payment method. The curriculum’s focus on “peer-tested best practices for each phase of the payment process” aligns with the industry standard that ERS payments are based on receiving documents.

Potential red flags for T&E expenses that fall outside of company policy includecharges for airline upgrades(Option I), which may indicate unauthorized luxury spending, andweekend stays(Option III), which could suggest personal travel disguised as business-related. These expenses often require additional scrutiny to ensure compliance with T&E policies.Cab fares(Option II) are typically routine and not inherently a red flag unless excessive or unsupported, making them less likely to be a policy violation compared to upgrades or weekend stays.

The web source from SAP Concur states: “Red flags in T&E expenses include charges for airline upgrades, which may violate policy on allowable travel classes, and weekend stays, which could indicate personal travel.” This supports Options I and III. Cab fares are noted as common expenses that require receipts but are not typically flagged unless unusual, per the Esker source: “Routine expenses like cab fares are less likely to be red flags compared to upgrades or extended stays.”

The IOFM APS Certification Program covers “Travel and Entertainment (T&E),” emphasizing fraud detection and policy compliance. The curriculum’s focus on “peer-tested best practices” aligns with identifying airline upgrades and weekend stays as potential red flags.

TheTax and Regulatory Compliancetopic in the APS Certification Program covers the Sarbanes-Oxley Act (SOX), enacted in response to corporate scandals like Enron and WorldCom in the early 2000s. A key provision of SOX is the protection ofwhistleblowers—employees who report fraudulent or illegal activities within their organization. Section 806 of SOX safeguards whistleblowers from retaliation, such as termination or discrimination, encouraging them to expose financial misconduct.

Option A (Executives): SOX holds executives accountable (e.g., through CEO/CFO certifications under Section 302), but it does not specifically protect them. This option is incorrect.

Option B (Whistleblowers): Correct. SOX’s whistleblower protections ensure employees who report fraud or violations are shielded from retaliation, addressing the chilling effect seen in scandals like Enron.

Option C (Auditors): While SOX strengthens auditor independence (e.g., via the Public Company Accounting Oversight Board), it does not classify auditors as a protected employee class. This option is incorrect.

Option D (Hourly employees): SOX protections apply to all employees who report misconduct, not specifically hourly employees. Whistleblowers, regardless of role, are the protected class. This option is incorrect.

Reference to IOFM APS Documents: The APS e-textbook underTax and Regulatory Compliancestates, “The Sarbanes-Oxley Act, enacted after scandals like Enron, includes Section 806 to protect whistleblowers from retaliation when reporting financial misconduct.” The training video emphasizes SOX’s role in encouraging transparency, noting that “whistleblower protections ensure employees can safely report violations, strengthening internal controls.”

Automating accounts payable (AP) processes offers several incentives, includingreduced costs of handling paper(Option I) through digital invoicing and workflows, andbetter forecasting(Option II) by providing real-time data for cash flow and spend analysis. However, automation does noteliminate the need for audits(Option III), as audits remain essential for compliance, fraud prevention, and internal controls, even with automated systems.

The web source from Esker states: “AP automation reduces costs associated with paper-based processes, such as printing and mailing, and improves forecasting by providing real-time visibility into financial data.” The Tipalti source adds: “Automation enhances efficiency but does not eliminate audits, which are still required for regulatory compliance.” This supports Options I and II, while ruling out Option III.

The IOFM APS Certification Program covers “Technology and Automation,” emphasizing the benefits of AP automation. The curriculum’s focus on “peer-tested best practices” aligns with cost reduction and improved forecasting as key incentives, while maintaining the necessity of audits.

A "direct spend" invoice pertains to expenditures directly tied to the production of goods or services, such as raw materials or inventory used in manufacturing or resale. In accounts payable, direct spend is distinguished from indirect spend, which covers operational expenses like supplies or repairs that support business operations but are not incorporated into the final product. The correct answer is "Inventory," as it directly relates to goods acquired for production or resale, aligning with the definition of direct spend.

According to the web source from SAP Concur: “Direct spend refers to the purchase of goods and services that are directly incorporated into a product being manufactured, such as raw materials… Indirect spend refers to expenses that support the operations of a business but are not directly included in the final product, such as utilities, office supplies, and facility maintenance.” Inventory, particularly raw materials or goods for resale, is a core component of direct spend, whereas supplies (e.g., office supplies) and repairs (e.g., equipment maintenance) typically fall under indirect spend. The option "Material" could also be associated with direct spend, but "Inventory" is the more precise term in this context, as it encompasses materials used in production or sale.

The IOFM Accounts Payable Specialist (APS) Certification Program includes the topic of “Invoices,” which covers invoice types and their purposes. While the IOFM study guide does not explicitly define “direct spend” in the provided sources, its focus on invoice processing and procurement processes implies familiarity with distinguishing direct and indirect spend. The curriculum’s emphasis on “peer-tested best practices for each phase of the payment process” supports the standard industry definition provided by SAP Concur.

Value Added Tax (VAT) invoices are subject to strict regulatory requirements, as they impact taxreporting and compliance. When a VAT invoice contains a billing error (e.g., incorrect amount, tax rate, or details), the recommended solution is to withhold payment and return the invoice to the vendor for correction. This ensures that the corrected invoice complies with VAT regulations, allowing accurate tax reporting and reclaiming of input VAT. Paying an incorrect invoice or reporting the error to the VAT administration without correction risks non-compliance and audit issues.

The web source from Avalara explains: “If a VAT invoice is incorrect, it must be corrected by the supplier issuing a new invoice or a credit note, depending on the nature of the error.” This aligns with the option to return the invoice to the vendor for correction. Paying the incorrect amount (Option B) or short/overpaying with an explanation (Option D) can complicate VAT reconciliation and may not be accepted by tax authorities, as the invoice must accurately reflect the transaction. Reporting the transaction to the VAT administration (Option A) is unnecessary unless the error involves fraud or persistent issues, and it does not resolve the invoice discrepancy.

The IOFM APS Certification Program covers “Tax and Regulatory Compliance,” including VAT compliance and invoice handling. While the specific question is not directly quoted in the provided sources, IOFM’s curriculum emphasizes compliance with tax regulations, as noted in the program description: “Review peer-tested best practices for each phase of the payment process – from receipt of invoice, through processing and payment.” The focus on accurate invoice processing supports returning the invoice for correction as the standard practice.

The tolerance level for discrepancies between a purchase order (PO) and an invoice refers to the acceptable variance (e.g., in price or quantity) that an organization allows before requiring additional approval or investigation. Keeping this tolerance level confidential is critical to prevent vendor fraud, as vendors could exploit knowledge of the tolerance to submit invoices with intentional discrepancies just within the acceptable range, leading to overpayments or unauthorized charges.

The web source from NetSuite highlights the importance of internal controls in invoice matching: “Three-way matching is an AP process used to verify a supplier invoice by checking it against its corresponding purchase order and order receipt. It reduces the chances of fraudulent invoices going undetected and, worse, being paid.” While this source does not explicitly address confidentiality of tolerance levels, the emphasis on fraud prevention implies that exposing tolerance thresholds could undermine these controls. If vendors know the tolerance, they might adjust invoices to exploit it, bypassing scrutiny.

Options B, C, and D are incorrect. Keeping procurement alert (Option B) is a general goal but not directly tied to confidentiality of tolerance levels. Avoiding internal audit scrutiny (Option C) is not a legitimate reason, as internal audits ensure compliance. Option D (depositing overages into a fund) is unethical and unrelated to accounts payable processes.

The IOFM APS Certification Program covers “Internal Controls,” which includes measures toprevent fraud and ensure accurate invoice processing. The program’s focus on “peer-tested best practices” and fraud prevention, as noted in the curriculum description, supports the need to keep tolerance levels confidential to safeguard against vendor manipulation.