Vendor File Mangement

The most important areas of vendor management appear to be validation of vendor information. Increases in both the verification of information capture up front and purging/cleaning of old vendor data indicate an increasing importance being placed on the quality of vendor data.

• More companies are doing additional verification before adding new vendors. More capture Tax Id and 1099 Category. More require W-9s or substitute W-9s. This allows most to avoid dealing with 31% withholding.

• Few companies use SIC codes or D&B Numbers. Many have found that SIC codes are not useful for catergorizing expenditures. Additionally, SIC codes are being replaced by NAICS (North American Industry Class System) codes but their utility has the same limitations as SIC codes.

• More regularly purge and clean up their vendor files on a regular basis.