Automating incoming invoice processing
5 min read
Short answer
An incoming invoice can be captured reliably today: supplier, registration number, invoice number, dates, total, VAT and usually the line items. Accuracy on ordinary invoices is high but never a hundred percent — which is why approval is not automated, only its preparation.
01How it runs
The invoice arrives by e-mail or is photographed. The system extracts the data, finds the supplier by registration number, matches it to a purchase order if one exists, and prepares it for approval with anything it was unsure about highlighted.
A person confirms or corrects. The invoice goes into accounting and into the payables view. The whole thing takes seconds instead of minutes, and it happens continuously rather than on the last day of the month.
02What accuracy to expect
The header — supplier, numbers, totals — is reliable almost always. Line items are weaker, particularly on scans and from suppliers with unusual layouts.
So it is worth measuring how many invoices pass without intervention. When that number drops, something changed — typically a supplier's template.
03Where a person is required
At approval. Not because the system could not compare a total to a purchase order, but because somebody is accountable for the payment, and that cannot be delegated to software.
And on mismatches. An invoice that does not agree with the order or the delivery note goes to a person, along with exactly what does not agree.
04What the company gets
Less retyping, and above all a continuous view of what is owed. A company that can see its unpaid invoices and their due dates decides about money differently from one that finds out at month end.
An unplanned side effect: duplicate invoices stop being paid twice. At any volume that alone pays for the whole thing.
Frequently asked
- Can incoming invoices be processed automatically?
- Yes. Header data — supplier, registration number, invoice number, dates, total and VAT — is captured reliably; line items somewhat less so, especially from scans.
- Can the system approve an invoice too?
- It should not. Somebody is accountable for the payment and that cannot be delegated to software. The system prepares the approval and highlights what does not match.
- How do I know capture stopped working?
- By how many invoices pass without human intervention. When that number drops, a supplier has usually changed their template.