ACCOUNTS PAYABLE

All invoices are sent to Northern Virginia Management, Inc.’s office. First, Sample Homeowners Association invoices are sent to the Property Manager for approval. If there is a discrepancy, the Manager will contact the vendor for verification. Second, all invoices are compared to the budget category to which they are applied. Approved invoices are then forwarded to Northern Virginia Management, Inc.’s accounting department for payment. Northern Virginia Management, Inc. pays no invoice unless it is certain that it is accurate, reasonable and approved by the Association’s Manager. Northern Virginia Management, Inc. assures the work has been completed to the satisfaction of Sample Homeowners Association.

On a weekly basis, Northern Virginia Management, Inc. Associates will have all invoices coded according to the established chart of accounts and operating budget for Sample Homeowners Association. Twice a month or as directed by the Board, Northern Virginia Management, Inc. will then process them for payment, and systematically file them. Copies of the checks with appropriate invoices will be grouped together and filed by month. Each month a designated Board member (who is usually the Treasurer) will receive the previous month’s paid invoices for review.

Payments are processed using the MICR system as described in Section 2.1 of this proposal to write checks. The Association’s logo and check account numbers are encoded on the check at the time it is written. This system is very secure because it eliminates (1) the need to store blank Association checks in the office; (2) the possibility of using the wrong checks, i.e., mistakenly using one Association check for another Association’s bills; and (3) handwritten checks (accounting information must be in the computer before a check is issued). Additionally, this computerized system saves the Association money because there is no cost to the Association for checks.