Lesson 4.2: Creating and Managing Vendors

If your organization uses the Accounts Payable module, you must set up Vendors to enter expenses as bills (accrual accounting). By entering a vendor invoice when received rather than when paid, you gain a more complete financial picture and can better plan your cash flow. This lesson covers adding new vendors, configuring them for 1099 tax compliance, and managing their status.

Vendors vs. Other Names

It is important to distinguish between two entity types in FastFund:

• Other Names: Used for one-time payments or expenses where you do not need to track an invoice or aging history (Basic Accounting).

• Vendors: Used when you need to record invoices, track what you owe (Accounts Payable), print aging reports, or issue Form 1099s.

Prerequisites: The AP Control Account

Before entering vendors, you must have an Accounts Payable (AP) Control Account set up in your Chart of Accounts. This account must have the Account Type set to “Payables”. This link creates the subsidiary ledger that allows you to print outstanding invoice lists and aging reports.

Adding a New Vendor

You can add vendors on the fly during transaction entry, but the best practice is to set them up via the Lists menu to ensure all tax and contact data is complete.

To Add a Vendor:

1. Navigate to Lists > Entities > Vendors.

2. Click the New (+) icon.

3. Check Existing Entities: If this vendor already exists in your database as a Donor or Employee, click the Existing Entities tab to link the records. This prevents duplicate names and allows shared contact info.

4. Vendor Info:

    ◦ Organization Name: The name of the company (max 50 characters).

    ◦ Vendor Number: A unique code (up to 11 characters). A common practice is to use an abbreviation of the name (e.g., “TARHEEL” for Tarheel Electric).

    ◦ AP Account: You must select the Accounts Payable control account this vendor is linked to.

5. Contact Info: Enter the address, email, and phone numbers. Note that the first address entered becomes the Selected Address used for printing checks.

1099 Configuration

FastFund can track payments to independent contractors and generate 1099-NEC and 1099-MISC forms. This must be configured before you start paying the vendor.

In the “Business & Account Information” section of the Vendor record:

1. 1099 Vendor: Check this box if the vendor is an independent contractor, sole proprietor, or partnership requiring a tax form.

2. Federal Tax ID: Enter the 9-digit EIN or Social Security Number. You cannot print a 1099 without this.

3. 1099 Category: Select the specific payment classification from the dropdown (e.g., Non-employee Compensation for services). FastFund will track all cash disbursements to this vendor for the calendar year based on this category.

Managing Vendor Records

• Editing: You can edit vendor details at any time. If you change a vendor’s name, all historical transactions will automatically update to reflect the new name.

• Inactivating: If a vendor is no longer active but has a transaction history, you cannot delete them. Instead, check the Inactive box in the Flags area. They will no longer appear in transaction screens but remain in reports.

• Deleting: The Delete button will only be active if the vendor has zero posted transactions. If the button is grayed out, the vendor has history and must be inactivated instead.