Technology

Automating Accuracy: Invoice Processing Solutions

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An Invoice processing automation system streamlines firms’ accounts payable operations by automating tasks such as data extraction from invoices, data validation, and data entry into a database for further analysis and processing. Processing invoices may be one of the most time-consuming chores, but it cannot be overlooked because it is directly related to the company’s finances. Automation addresses this issue by speeding up invoicing processing and enhancing data quality.

Invoice processing automation is a system that streamlines accounts payable operations by automatically processing invoices.  It also updates the information in your Enterprise Resource Planning (ERP) system, ensuring that all records are kept digitally. It seeks to dramatically reduce the time required for manual invoice processing while also reducing the margin of error that human tasks pose. 

 

Why is Invoice Processing Automation Necessary?

An average-sized company takes approximately 25 days to manually handle a single invoice from receipt to payment. This could increase even more if the number of invoices increases along with the number of manual touch points, eventually resulting to a tremendous loss of time and resources for the organization.

Manual invoice processing carries a high risk of errors and duplicate payments. Aside from that, the potential of staff theft and resource misappropriation hangs big over most firms, with more than 74% of them becoming victims of payment scams in 2020. 

Both factors lead to delayed invoice processing and strained supplier relationships, which eventually influence corporate productivity. 

This is where replacing manual operations with automated invoice processing becomes necessary to ensure that the entire process is accurate, efficient, and error-free. 

 

Advantages of Automated Invoice Processing.

The move from manual entry to Invoice processing automation also comes with various benefits, such as:

 

  • Reduced manual entry.

According to a Coupa survey, more than 51% of respondents agree that human data entry is inefficient and time-consuming, and they are actively seeking for ways to improve its accuracy and efficiency. Automated data input does this by lowering the time required to process invoices by tenfold when compared to manual processing. 

 

  • Reduced margin of error and increased security

Manually processing bills is prone to errors and inaccuracies due to factors such as fatigue and lack of focus. 

This is where automatic invoice processing comes into play, ensuring that the data entered is correct and free of any errors. Furthermore, the automated system compares the extracted data from the supplier’s invoice to the company’s records to decrease the possibility of fraud.  This greatly improves the efficiency of the operations, since previously they would have to be manually validated by an employee or clerk, which could take hours. 

 

  • Transparent, traceable invoice records

Traditionally, once money is received, invoices are placed in files or folders that are untraceable and difficult to recover if needed. 

However, automated invoice processing solutions employ an Electronic Document Management System (EDMS) to store data in a centralized digital database in a methodical manner. 

This type of storing creates an audit trail and makes bills easily retrievable if necessary. Furthermore, it simplifies the tracking of all documents and reduces the likelihood of misplaced or missing bills. 

 

  • Monitoring and customisation.

Monitoring manual invoice records is a difficult undertaking due to their large and unorganized nature. However, in the event of automated invoice processing, the processed invoices are transparently kept in a centralized and immediately accessible database. 

This ensures that spending can be tracked in real time and any discrepancies may be promptly reported. The business process automation software also offers more customization choices to guarantee that the entire operation is simplified to meet your specific business needs by structuring the workflows correctly. 

It also allows for seamless integration of your accounting operations, ensuring that all accounting activities and processes are completed synchronously and without conflict with one another. 

It also enables software development businesses to incorporate bespoke logo designs, texts, stamps, and other details automatically, saving time and resources. Such software also promotes stronger compliance with custom regulations and policies, ensuring that the outcomes meet the company’s requirements. 

 

  • Early payment reductions and better supplier ties

Enabling automated procedures makes the entire process more efficient, making it easier for employers to meet deadlines. Given that most suppliers provide early payment incentives, it is possible to take advantage of them by avoiding late payments. 

Furthermore, timely payments help keep suppliers satisfied, and most business process automation software includes a platform that allows suppliers to receive real-time information on the status of their bills. This helps to ensure that there are no disagreements between the company and its suppliers, and that their relationship remains positive.

 

  • Automatic invoice routing

Manual routing is one of the most frustrating aspects of invoice processing for more than 37% of businesses. Once the invoice has been processed with the help of business process automation, it is manually routed to a number of relevant parties for approval, depending on the amount and kind of payment. However, due to a lack of established path of clearance, can lead to extra delays and possibly even lost.

Users may quickly set up the designated workflow using the automated invoice processing software to ensure that the invoice reaches the appropriate approvers. Users receive tailored notifications to remind approvers of pending invoice approvals, ensuring timely approval.

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