Close the final contractor invoice and run the first Latvian payroll

One person can have two legitimate payment tracks

A contractor invoice received after employment starts may still cover earlier services. Its arrival date does not turn it into salary. Keep the service period and employment period explicit, then reconcile each payment to its own approved obligation. The example below is fictional; its approval and payment dates are agreed operating assumptions, not Latvian statutory payroll deadlines.

The example assumes the historical assessment and future employment decision have been handled through their proper owners. It does not decide whether an old amount should legally have been treated differently. If that assessment changes a payment's treatment, implement the actual advice and correct the records rather than using this calendar to bypass it.

The completed transition calendar

20 November: manager confirms which November deliverables remain open. 25 November: worker and employer complete the package/document steps required for the proposed employment, while the actual employer owns registration under the relevant procedure. 30 November: contractor services in this example end and the buyer accepts the completed deliverables. 1 December: employment begins after the applicable prerequisites are met.

3 December: the final November invoice arrives for EUR3,800 services plus EUR200 approved travel, total EUR4,000. 4 December: accounts payable matches the deliverable approval and travel evidence. 10 December: it pays EUR4,000 under the example's agreed invoice terms. 15 December: operations submits the employee's approved December payroll inputs. 18 December: the responsible approver accepts the payroll version and finance funds it under the example service calendar. The employee pay date is the actual agreed date in the employment/payroll arrangement, recorded separately; do not infer it from funding date.

Sources: vid.gov.lv

Reconcile by period and obligation

Contractor ledger: reference NOV-01; services period 1–30 November; services EUR3,800; approved travel EUR200; payable EUR4,000; paid 10 December; balance EUR0. Employee payroll ledger: December employment; gross salary EUR3,200; actual payroll calculation and deductions referenced; provider funding and employee payment have separate transaction references. No personal net-pay amount is invented here.

The duplicate check is precise: NOV-01 must not also appear as a EUR4,000 salary adjustment in December payroll. Conversely, paying December salary must not cause accounts payable to mark NOV-01 settled. In the package illustration, company funding may include EUR4,600 December employment cost and service plus EUR3,200 security; the EUR100 benefit begins and is charged from January, bringing the steady-state monthly amount to EUR4,700. Those are funding components, not three bank payments to the worker. Distinguish the employee bank payment from the provider invoice and held balance.

A late invoice is an exception, not a reason to improvise payroll

Suppose NOV-01 arrives on 12 December, after the planned contractor payment run. Accounts payable records receipt, checks the same evidence and applies the agreed contractual payment terms and its actual exception process. It tells the worker the confirmed payment date once established. Operations checks that the invoice has not been placed in employee payroll as a workaround.

If EUR200 of travel is disputed, identify that line and its evidence. Keep the undisputed and disputed amounts visible, and have the responsible owner decide treatment under the actual terms. Do not assert that a disputed expense authorises withholding employee salary. An employment payment issue belongs to the employer/payroll process; a contractor-invoice issue belongs to its separately assessed and contracted process.

What finance should receive at month end

The handover contains the old invoice and service-period reference, its approval and payment evidence, the first payroll report reference, the provider funding breakdown and any held security. An unresolved item includes its amount, reason and next action. That lets finance explain why the transition month uses more cash without describing every line as recurring employment cost.

If funding is converted into euros, keep currency movement, any provider conversion charge and bank fees separate. Reconcile the applied rate and converted amount to the funding request. A EUR-to-EUR payment has no conversion difference to explain.

Use the four-track plan to prevent false closure

In the transition tool, close contractor payment only after its own payment evidence is recorded. Close first-payroll preparation when the inputs and funding are accepted; employee payment confirmation is a further event to record. If either track is open, state exactly what remains. The worker should receive one coherent explanation even when two internal owners perform the work.

The final example status is: November invoice EUR4,000 paid; December payroll inputs accepted; provider funding reconciled; employee payment confirmation pending until the actual pay run. This is a useful handover because it does not call an approved file a completed payment.