Invoice Processing

Invoice Processing

 

Manual Invoice Process and Journey

An invoice is received into the business in paper, email, pdf or another digital format.  The information from the invoice, generally just header information, includes the following:

Supplier Details        Date       Purchase Order Number       Invoice Number       Net Amount       VAT Amount       Total Amount

 

 

How does it work?

This data is manually entered into a payment system, excel spreadsheet, or finance system in preparation for approval for payment

Approvals depend on multiple factors but usually begin with confirmation the goods/services were ordered, and confirmation they have been received.  This is called 3-way matching.  (Check our Pain Point page on 3-way matching here) 2-way matching is also used when the invoice is matched to the order or the GRN.  This often involves a copy of the invoice or the report that was created on receipt, being sent around the business for approval signatures.  It is good practice to scan or make a copy of the invoice for electronic filing as a backup for retrieval by the AP team or Auditors.

Once a match has been confirmed, depending on business rules, it may require a second or additional signatory before being passed back to the AP team for payment.

This process is filled with potential ‘potholes’. From the point of arrival of the invoice, these are the ‘holes’ that start to appear…

Then once arrived, these invoices need to be copied, scanned and logged and then filed.  This introduces the ‘Human Error pothole’.

Drawbacks…

When the invoice has been entered into a finance system or digital report, it is then sent around the business for matching and/or approvals.  Here is the next pothole in the process.

The AP team spend time chasing the invoice around the business, whilst dealing with calls from suppliers asking for updates on payment dates.

Finally, an approved invoice arrives back with the AP team and can be put forward for payment.  Final checks on supplier name, bank account details, etc are made.  They are coded and the amounts checked along with the taxes due.  Budgets are updated internally and the invoices are added to the next payment run. The information is entered for reporting on payment practices, activity reports and invoice data reporting.

 

Invoice processing with Automation

Invoice process automation is a wide term covering everything from the most basic header data capture and export to finance system through to an integrated purchase to pay solution capturing detailed line data and 3-way matching, coding, exception handling, workflow, mobile app for approvals and reviews and direct posting to finance system for payment – a complete, touchless process.

Why not fix you’re the potholes in your invoice processing? For more information on our automated invoice matching solution, download the datasheet here or find out how our solution can help you with your automated invoice processing by getting in touch with our listening team.

 

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More Questions?

Invoice matching solutions can greatly improve productivity and cash flow. Purchase order processing can be simplified with a fully automated solution, using invoice matching software.

AI in accounts payable can eradicate the need for paper invoices and manual processes!

Documation can provide a solution to almost any information management or document processing challenge. Contact us now to find out how we can help.