The invoice establishes what services you or your company provided, how much is due and when, and how your customer can pay. Legally speaking, an invoice creates an account receivable. This is a claim for payment for services rendered or goods provided that is legally enforceable. But the invoice process as a whole goes beyond these definitions. Chase invoices like you really want them The most important part of the invoicing process happens after you’ve sent the bill. Because no matter how accurate, professional or well-formatted your invoice is – it probably won’t get paid on time. You have to follow up.


This topic describes the capability for automating your vendor invoice processing and the benefits of using an automated process. This capability consists of features that are turned on in Feature management. These features apply only to vendor invoices, not to invoices that are processed using the Invoice journal or Invoice register journal page.

Organizations often work with third parties to process paper invoices by using an optical character recognition (OCR) service provider. The service provider returns machine-readable invoice metadata. To help with automation, the Accounts payable automation features let you consume these artifacts from Accounts payable.

You can automate some Accounts payable vendor invoicing processes. These processes include submitting imported vendor invoices to the workflow system and matching posted product receipt lines to pending vendor invoice lines. The automated process shows information about the progress of a vendor invoice as it moves through each of the processes. This capability can help Accounts payable clerks and managers process vendor invoices more efficiently. It also helps reduce the errors and inefficiencies that can occur when information is manually entered and processed.

The automation processes can be used to perform these tasks:

  • Automatically submit imported invoices to the workflow system.
  • Match product receipts to pending vendor invoice lines.
  • Simulate posting before a vendor invoice is posted.
  • Quickly and efficiently view workflow and automation history.
  • View and analyze the results of automating vendor invoice processing.
  • Resume automated processing for multiple invoices.

Submit imported vendor invoices to the workflow system

As part of a touchless Accounts payable invoicing process, you can have the system automatically submit an imported invoice to the workflow system. The process will run in the background, at a frequency that you specify (either hourly or daily). The capability to automatically submit imported invoices to the workflow system requires that your process begin with an imported invoice. To ensure that the invoice can be processed from start to finish without manual intervention, an automated posting task must be included in the workflow configuration.

Invoices that are related to purchase orders (POs), and invoices that contain a non-PO procurement category and non-stocked lines, can automatically be submitted to the workflow system. Invoices that are manually entered and invoices that are created using the Vendor collaboration invoicing workspace must be manually submitted to the workflow system. Prepayment application processing must be performed manually for imported invoices. You can manually apply prepayments before or after posting the imported invoice. You can manually apply prepayments to unposted standard invoices using the Vendor invoices page. After posting, the settled prepayment will be available to manually apply to other invoices from this vendor on the Vendors page (Accounts payable > Common > Vendors > All vendors > Invoice tab > Apply).

The automation feature provides a flexible framework that lets you define company-specific rules for submitting imported vendor invoices to the workflow system and matching posted product receipt lines to pending vendor invoice lines.

Match product receipts to invoice lines that have a three-way matching policy

The system can automatically match posted product receipts to invoice lines that a three-way matching policy is defined for. The process will run until the matched product receipt quantity equals the invoice quantity. As part of this process, you can specify the maximum number of times that the system should try to match product receipts to an invoice line before it concludes that the process failed. The process will run in the background, either hourly or daily. You can run the automated matching process as part of the process for submitting invoices to the workflow system. Alternatively, you can run it as a standalone process.

Pre-validate vendor invoice posting

Posting simulation completes the validation steps that are done during the posting process for vendor invoices, but no accounts are updated. To run the process, you can select either a single invoice or multiple invoices on the Pending vendor invoices page.

Enhanced experience for viewing workflow and automation historical information for vendor invoices

An easy-to-read view of vendor invoice workflow history is provided. Vendor invoice workflow history can be accessed directly from the vendor invoice. Therefore, fewer clicks are required to find that information. If your organization has enabled the ability to automatically submit imported vendor invoices to workflow, the automation history is provided for the imported invoices. The automation history helps you identify the current process step, as well as the steps that have already been completed. When a step is unsuccessful, the system provides detailed information to help you understand the reason for the failure.

Analytics and metrics

The Vendor invoice entry workspace lets you focus on vendor invoices that didn't make it through the automated process. Tiles on the workspace list information about vendor invoices that weren't successfully submitted to the workflow system, imported, or matched to product receipts. Microsoft Power BI metrics are also provided to give Accounts payable managers insight into the efficiencies of vendor invoice automation.

Resume automation processing for multiple invoices

When an imported invoice isn't successfully submitted to workflow using the automated process, the system will remove it from further automated processing. An accounts payable clerk can review and edit the invoice before the automated process resubmits it to workflow. When a failure reason can be resolved by the same fix for multiple invoices, you can restart the automated process on the Resume automated invoice processing page.

Tracking the Invoice received date value

The Invoice received date value indicates the date when the company received the invoice from the vendor. It provides a starting point for tracking the invoice's progress through the automation processes. This value can be included in the imported data for a vendor invoice. For invoices that were manually created, you can specify the date. If no value is entered, the current date is used by default.

Tracking the Imported invoice amount and Imported sales tax amount values

The Imported invoice amount and Imported sales tax amount values for vendor invoices can be provided in the vendor invoices import file. Typically, these values are from an invoice that was scanned by an outside provider and included in the import file. As the invoice is processed in Accounts payable, the system calculates values based on the invoice data. The invoice can be posted only if the imported values match the calculated values. Matching values ensure that the invoice accurately reflects the amount that is due to the vendor. If your organization allows imported invoices to be submitted to the workflow system automatically, you can optionally require that the imported totals match the calculated totals before the invoice can be submitted to the workflow system.

Vendor invoice automation - Resume automation processing for multiple invoices

When an imported invoice isn’t submitted successfully to workflow through the automated process, the system will remove it from further automated processing. An accounts payable clerk can review and edit the invoice before the automated process resubmits it to workflow. When a failure reason can be resolved by the same fix for multiple invoices, you can restart the automated process on the Resume automated invoice processing page.

Automated invoice processing is a method of using automation software to extract invoice data, populate the information in an accounts payable system, and process invoice data for accounts payable. Effectively used, automated invoice processing saves valuable time and money for a company’s AP department.

Automated invoice processing generally includes automation of:

  • Matching price
  • Managing purchase orders
  • Data entry
  • Transferring digital payments
  • Streamlining workflows
  • And more…

A smart automation solution can handle effective invoice management.

The responsibility of invoice processing relies on accounts payable. The traditional method is a timely system of entering invoice data, creating paper invoices, matching purchase orders, and filing endlessly. It’s a bloated process that perpetuates an inefficient environment. Invoices are being received via mail, fax, email, etc.

This is why the ap process needs automation. It’s the next level of manual processing. A payable department can streamline the time-consuming system with artificial intelligence and machine learning.

What is Automated Invoice Processing?

A digital invoice is a component of workflow automation. Technology is redefining business processes and this includes invoice management, from arrival to post. A company can accelerate the payable process by taking advantage of automation.

Compared to a manual invoice, an automated invoice moves through a workflow faster. AP automation takes all of the menial tasks an accounting department must accomplish and uses a computer to complete them. Whether it is matching price, purchase order, or data entry, a smart automation solution can handle the easy stuff.

How Does Automated Invoicing Work?

Invoice Procedure

The traditional method of invoice document management starts when the accounting department receives a supplier’s invoice. At this point, it is matched and approved. Typically, if the amount of the invoice is a large payout, further approval is needed.

From there, it must then be entered into the system where it is “posted” for payment. Then payment is issued. Depending on the company, sometimes the manual invoicing process can take up to 15 separate steps. This is a large amount of time; especially when processing multiple invoices.

Automated invoicing cuts to the chase. When the invoice arrives, it is scanned and fed into the digital accounting system. This form of data capture (otherwise known as invoice capture) cuts out hours of manual data entry. The invoice automation software will then convert the data into a text-searchable document.

The invoice data can be extracted and mapped in the automated management system so it remembers which fields to capture and register into the ERP system. This includes data like supplier name, the purchase amount, quantity, and so forth. Invoices are then routed to the appropriate parties for review and approval.

Benefits of Automated Invoice Processing

Automated invoicing has a multitude of advantages. This includes up to 80% reduction in a company’s procure to pay cycle. Additional benefits include:

  • Cuts down on error rates. Less manual entry means less room for mistakes.
  • Speeds up the approval process and reduces processing times.
  • Saves on labor costs. Staff can work on more business-critical tasks.
  • Reduces duplicate invoices and payments.
  • Improves relationships. Employees are liberated from tedious tasks and vendors have a more transparent process.
  • Slashes the costs of manually processing invoices (postage, paper, etc).
  • Better to secure early-payment discounts and avoid making late payments.

The ability to assign a GL code without direct access to a company’s accounting platform is another benefit named by reviewers online.

Software Solutions for Automated Invoice Processing

Automated invoice processing software has emerged as a disruptive innovation. The technology has produced such tremendous savings in labor and cost, it has restructured the way accounting does business. Much like word processing, many organizations consider invoice processing software an absolute essential.

Invoice Processing Steps In Sap

According to a recent report, there are around 3757 invoice processing applications in the world. When looking for a tool your finance teams can work with, consider some of these factors:

Unified Console

Accounts payable automation puts everything at your fingertips. Platforms are typically run from a single dashboard that provides managing power of buyers, vendors, invoicing, payments, financial data, etc. The processing workflow should handle:

  • Recurring billing
  • One-time invoicing
  • Metered, volume, and tiered charging models
  • Subscription management


Invoice Processing Steps

A superior automation platform should enable the customer to create custom workflows with tailored invoicing solutions. A smooth process reduces exceptions and disputes. A business should establish automated exception handling to reduce leakage from the system. This stronger compliance allows you to create an invoice solely based on tasks or staff rates.

A smart software platform will also allow a company to incorporate branding. Custom logos, text, and optional extras can be used with invoicing for brand continuity.

Relationship Management

Automation has been a gift for relationship management in every industry and every job role. It keeps people from dropping the ball. Finance is no different. Invoice processing software gives suppliers clear visibility on their relationship with your business. Payments, orders, and invoices can be viewed by all parties involved. It also enables a company to provide a supplier with a number of different options for electronic invoicing.

Monitoring and Reporting

Due to the transparency of invoice automation, a business can easily monitor expenses and know what is being spent, when, and where. Run insightful reports in real-time to enable quick business decisions. The more invoice data scanned into the system, the easier it is to watch for patterns and trends.


An automated invoice processing tool allows a business to stay connected internationally, without all the hassle of paperwork. Look for a program that is multilingual and accounts for country-specific VAT regulations. The ability to sell products and process them globally does wonders for expanding operations. An integrated solution allows you to control the complexity of business on a global scale.


Invoice processing software is a divine tool for operations. Anyone who is sick of pushing paper should appreciate this type of software. The system should also provide easy management of transactions through credit cards, ACH/EFT, and PayPal.

Accounts payable can take advantage of automated billing to ensure that services are being aligned with purchase orders and receipts. The platform should allow accounting to continuously check the status of an invoice, with indicators like “in process,” “approved,” or “not paid.”

Invoice Automation Features

Artificial intelligence: nimble learning speeds up processes

When invoices come through, accounts payable is the front lines of recording and verifying the data, which means it also has to spot exceptions and make decisions on a case-by-case basis. In an automated solution, artificial intelligence technology does the heavy lifting of recording, verifying and identifying potential issues.

Also called machine learning or adaptive learning, artificial intelligence is the ability for computers to recognize patterns and exceptions without the intervention of manual efforts. In the context of automated invoice processing, artificial intelligence quickly learns the tasks that require judgment, like discerning the approvers for specific invoices or assigning specific general ledger codes, thus speeding up processes that were often slowed down with manual efforts. It’s one thing to automate processes, and another to make them faster as your business scales. That’s why artificial intelligence makes all the difference in an automated account payable solution that can grow with your company.

Optical character recognition (OCR): input data in real-time and with accuracy

Paperless technology is nothing new, but for it to revolutionize the accounts payable workflow, the technology needs to do more than convert documents into digital format. That’s where Optical Character Recognition (OCR) comes in. The technology extracts text in the paperless formats and assigns that data to the appropriate fields within an automated accounts payable solution, thus eliminating manual data entry. Without OCR, you would just have an image of the document, which means you would still have to input the data manually into an accounts payable system.

Even with the assurance of accuracy, it may still feel uncomfortable to set up an automated task without another check. That’s why automated invoice solutions often pair OCR with another layer of invoice data extraction to ensure that the data input was complete and accurate.

Purchase order matching (PO): business rules reduces workload puts the focus on exceptions

Gathering and reconciling invoices, purchase orders, and approvals is an essential task in the accounts payable workflow; however, it often leads to bottlenecks and delays in the invoice payment process. At first glance, manual execution seems to be the nature of the task—but no longer. Invoice processing systems leverage the technology of business rules management system to automate purchase order matching. By configuring guidelines and percentage tolerances, companies can drill down and customize the guidelines with each seller. The AP automated system will review the digital invoices against what’s configured, automatically approving the invoices that comply with the approved business rules and match up with its purchase order. When an invoice and a purchase order amount do not match up and are outside of the tolerance range, the automation makes it easy for companies to review those exceptions within the payment system. Automated invoice system puts the focus on what truly needs attention, which cuts down the manual workload of reviewing and matching every invoice and purchase order.

Automation seems all the rage these days and rightly so—it paves the way for other much-needed features, like automated purchase order matching, that make invoice automation an all-encompassing solution for doing business on a global scale. Features like supplier onboarding, tax and regulatory compliance, global payments, reconciliation and more are also important aspects that make for an efficient end-to-end AP automation workflow, and these features are also supported by the technologies leveraged by invoice automation. Simply put, automation gives companies the ability to grow and scale and transform their accounts payable process with ease.


The best automated invoice processing software will make use of all these features in one form or another. The quicker an accounting department adopts this digital process, the easier it will be to focus on growth.

Next, companies will be looking to manage large financial processes from mobile devices. A business that is stuck in traditional ways, won’t be around in 5 years to worry about it.

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