Accounts payable tasks rarely dictates a company’s agenda. But invoice processing is a silent time robber that offers a relatively easy opportunity to cut costs and acquire more control on business processes, including those related to invoice processing.
Large-sized companies can easily receive well over 50.000 invoices on annual basis from at least 1.000 different suppliers. Each of those invoices has to be coded and validated with master data stored in ERP system(s) and subsequently authorized by budget holders.
The approved invoices are then entered into the ERP system or accounting software. The processing lead-time per invoice can easily take up days or weeks.
The lead time for invoice processing will take longer in case an invoice turns out to be invalid or not match with the corresponding order or purchase plan.
As a result, the invoice has to be further investigated and depending on the outcome is has to re-enter the standard procedure. For instance, an invoice with invalid pricing has to be sent back to a supplier who requires time as well to investigate the invoice.
Moreover, invoices are not standardized information carriers. Suppliers communicate invoices in a number of materials (paper, PDF, electronic) and a vast range of formats. Such pluriformity hampers fast processing of invoices.
Even when digital invoices (PDF) are received, it is common practice at AP departments to print a digital invoice (PDF) in order to have it distributed amongst budget holders for approval.