All 22 Vendor Management questions
More in Vendor Management
What is the vendor master file? What are payment terms and how are they expressed? What is a W-9 (or W-8) form and why does AP collect it? What is a preferred supplier list and why maintain one? Why is standardized vendor naming and data important? What is the purpose of a vendor onboarding checklist? Why are controls over vendor bank-detail changes so important? How do you detect and prevent duplicate vendors in the master file? What is a supplier statement reconciliation and why perform it? How does vendor segmentation improve AP management?
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Accounts Payable & Receivable › Vendor Management

What is vendor onboarding and what checks are involved?

Beginner

Answer

Vendor onboarding is setting up a new supplier before transacting: collecting legal and tax details (e.g., W-9/W-8 or VAT registration), validating bank details, screening against sanctions/denied-party lists, checking for duplicates, and agreeing payment terms. Good onboarding prevents payment errors, tax issues, and dealing with prohibited parties.
Real-world example A new supplier is screened against sanctions lists and its bank details verified by call-back before the first PO is raised.

Common follow-ups: Why screen against sanctions lists? | What tax forms are collected?

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All 22 Vendor Management questions