Digital Invoice Processing is the Bread & Butter of AP Automation
Published on: 15 October 2021
In order for supplier invoice data to move seamlessly between the company’s ERP, purchase orders, accounting, and AP Automation software, invoices need to be digitized. That’s why we say digital invoice processing is the “bread and butter” of AP Automation.
Invoices come in different formats, so it’s good to know the different invoice formats and what invoice data capture software is used to extract invoice data.
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The most efficient way to receive and transfer invoice information, as the invoice is already in electronic format and the data is easily transferred. Invoice capture technology picks up the information.
Paper invoices are made digital with invoice scanning solutions. OCR technology picks up the information on the invoice and creates data fields in electronic format.
PDF invoices are sent to a specified email address where invoice capture technology picks up the invoice data and stores it in a database.
Once the invoice data is in electronic format, the AP automation solution can populate a central dashboard with all the invoices received. Non-PO invoices are passed through in an approval workflow that goes to the approvers (and their supervisors) responsible for the purchase.
In advanced AP automation systems, PO invoices are matched to an internal or external purchase order by the software.
If there is a match, the invoice is sent to the ERP for payment, a process that takes place in the background within minutes of receipt. If there is an exception, the approver receives the PO and the invoice and all the information they need to clear the exception.
All of these processes occur because data capture automation has extracted the information from the invoice, no matter what format it was received in. Because the information is in digital format, the data can also be tracked in the approval system, and be searchable in a vendor invoice archive.
Where are you in your AP automation software journey? For a complete guide on AP Automation visit our whitepaper on the subject: https://www.rillion.com/whitepaper/guide-ap-automation-solutions/