CpD Account: What It Is and Why Large Companies Limit It

A CpD account is a collective account in accounts payable for suppliers a company buys from only once or very rarely. CpD stands for "Conto pro Diverse". Instead of creating a separate master record for each of these suppliers, accounting posts all their invoices to one shared account number. Name, address and bank details are then stored not in the master data but in each individual document.

For a single reimbursement, that is pragmatic. For compliance, it is a blind spot, because every supplier on the CpD account bypasses the approval that applies to suppliers with a master record. This article shows how a CpD account works, why large companies keep it tightly limited and what changes when a single creditor covers all one-off requirements.

At a glance

• On a CpD account, the supplier's name, address and bank details are entered again in every document. That saves setting up master data, not the work.
• Suppliers on a CpD account bypass supplier approval, sanctions screening and the check on changed bank details. Large companies therefore allow it only for a few exceptions.
• How much on your CpD account does not belong there is shown by an analysis of the postings from the last twelve months by IBAN, VAT ID and name.
• In the Single Creditor Model, a single creditor is permanently set up in the ERP. It orders from the suppliers, pays them and remains your contract partner for returns.

What is a CpD account?

A CpD account is a creditor with no fixed business partner behind it. In the ERP it exists as a perfectly normal account number, often in a dedicated account group for one-time creditors. The difference lies in the master data.

The CpD creditor carries no real supplier name and no bank details, because this information only enters the system with the posting. For every invoice, accounting types in the supplier again. On the sales side, the counterpart is called a CpD debtor.

The reasoning behind it is easy to follow. Full supplier onboarding with checks and approval is not worth it for an invoice that will never come back.

How does a CpD creditor work in the ERP?

This is how it works in SAP, and other ERP systems behave similarly: accounting posts the invoice from an unknown supplier to the CpD creditor. According to the SAP documentation, the system opens an additional entry screen for the address and bank data during entry, and accounting fills it in from the invoice.

Payment goes through the normal payment run, with the system taking the bank details from the individual document rather than from a master record. If the company buys three times from three different vendors, the result is three documents, each with its own supplier data, on the same account number, and accounting enters, checks and pays each of them separately.

The CpD creditor is fast because nobody has to create a master record. The same design, however, explains why it is hard to analyze later: to the ERP, all these vendors are a single creditor.

Why large companies limit CpD accounts

In large companies, the CpD account is above all a question of control. Every new supplier there normally goes through an approval before the company pays it. The CpD account bypasses that approval in three places:

• Separation of duties is missing. For suppliers with a master record, one team maintains the master data and another posts the invoices. On the CpD account, the same person enters the invoice and the bank details in one step, often without a second approval.
• Sanctions screening comes to nothing. EU sanctions prohibit every company in the EU from making funds available to listed persons and entities. Companies therefore screen suppliers against the sanctions lists, usually when the master record is created. A CpD supplier has no master record. If nobody checks the individual posting, it stays unchecked.
• The bank details are the weak point. Because the IBAN enters the system anew with each document, no approval for changed bank details applies. Fraudulent invoices with someone else's IBAN have an easy time here.

The year-end audit can raise this too. Auditors assess the internal control system, including accounts payable. On the CpD account they find no master record against which a supplier can be checked, so accounting has to document every unclear item individually.

Many companies therefore allow the CpD account only for tightly limited cases, such as reimbursements to private individuals or small one-off amounts. An internal rule sets the amount up to which it may be used.

Where the CpD account reaches its limits in day-to-day work

In practice, the CpD account often ends up holding suppliers that are not one-time at all. A department needs a spare part, an installation service or material for a trade fair, and because regular supplier onboarding takes too long, the invoice simply goes through CpD. A few months later, the same vendor comes back. And then again.

Each of these repeat suppliers keeps bypassing supplier approval. On top of that come two weaknesses that grow with every posting:

• The work moves into the document. What sits once in the master record for a supplier that has been set up, accounting types in again for every invoice.
• The history is missing. All vendors share one account number. Nobody can see how much volume sits with which supplier without manual work.

CpD account or a fixed creditor for all one-off requirements

The obvious alternative, a separate creditor for every individual supplier, closes the control gaps, but at full price. Every setup costs checks, approval and maintenance, which is exactly the effort the CpD account was meant to avoid. A single one-off order costs around €500 in process costs in the conventional process, as our comparison of the options for one-off orders shows.

The diagram therefore shows a different approach: the same three one-off orders, once on the CpD account and once on a single fixed creditor through which all one-off requirements run.

Four questions make the difference clear.

Where is the supplier data? On the CpD account, it is re-entered by hand in every document. With the fixed creditor, it is stored once, in the creditor's master data.

When are checks done? On the CpD account, the check has to happen on every single posting. With the fixed creditor, it happens only once, when the creditor is set up.

Who pays the supplier? On the CpD account, the answer is your accounting, bank details per document. With the fixed creditor, it is the creditor; you only pay it.

Who is the contract partner for returns? On the CpD account, it is the individual supplier, for whom you never created a master record. With the fixed creditor, it is the creditor itself.

This is where the Single Creditor Model comes in. Pedlar, the service provider behind the model, is set up once as a creditor in your ERP system. After that, ordering, payment and invoicing for every one-off requirement run through Pedlar; the vendor delivers directly to your site.

Pedlar orders from the supplier in its own name and pays it. Pedlar sends an invoice for each order, and your contract partner is Pedlar, including for returns and warranty.

The supplier behind it needs no master data on your side, and your approval runs once, when Pedlar is set up as a creditor. After that, your accounting always pays the same approved bank account. Pedlar screens its suppliers every night against the sanctions lists of the EU, the US and the UK. Pedlar runs this model as a managed service.

How to check your CpD account with an export

A simple analysis shows whether your CpD account is still a fallback or has already become a permanent arrangement. All you need is an export of the postings on the CpD creditor for the last twelve months with name, IBAN, VAT ID and amount. In SAP, the name, address and bank details of CpD documents are stored in table BSEC, and the amount comes from the document line item.

1. Count the documents. The number shows how much data entry work sits in this account.
2. Group by IBAN and VAT ID. Every bank account or VAT ID with two or more documents belongs to a supplier that is no longer a one-time supplier.
3. Group by name. Standardize the spellings first, because to the ERP, "Müller GmbH" and "Mueller GmbH" are two different suppliers. If one name has several IBANs, that case must be clarified before any further payment.
4. Add up the amounts of the repeat suppliers. This total is the volume that no longer really belongs on the CpD account.

Every repeat supplier from steps 2 and 3 is a supplier your supplier approval never saw, and one that someone would have to screen against the sanctions lists on every posting. Next year, accounting enters it by hand again. These suppliers belong on a creditor with a master record and approval. Our article on ordering without supplier onboarding describes the other routes besides CpD.

Frequently asked questions

What does CpD mean? CpD stands for "Conto pro Diverse". It is a collective account for business partners a company deals with only once or rarely: a CpD creditor for suppliers and a CpD debtor for customers.

Is a CpD account not permitted? No, it is not prohibited. However, the invoice must contain the details required by § 14 UStG (German VAT Act). Because the account bypasses supplier approval and sanctions screening, many large companies allow it only for tightly limited cases with fixed amount limits.

When does a supplier no longer belong on the CpD account? At the latest when the same supplier comes back a second time, because from then on it regularly bypasses approval and sanctions screening, and the data entry repeats. The supplier then belongs on its own master record or on a creditor through which all one-off requirements run, as in the Single Creditor Model.

Do I have to set up new suppliers for the Single Creditor Model? No, Pedlar is set up once as a creditor in your ERP system, and the suppliers Pedlar orders from on your behalf need no master data on your side.

Find out how the Single Creditor Model takes the load off your CpD account: Book a call →