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Automated AP Invoice Processing for the Modern Business
Automated AP Invoice Processing for the Modern Business
With accounts payable invoicing automation, companies can save money, gain efficiencies, reduce errors, eliminate duplicates and free up their AP employees to focus on more important projects.
As organizations across all industries implement technology to streamline their business processes, more of them are turning to automated invoice processing to help reduce errors, eliminate duplicate invoices, save time and increase employee productivity. By applying automation to a process directly linked to profitability, organizations can more effectively manage their accounts payable (AP) process while also empowering their accounting departments to focus on more business-critical tasks.
Companies that rely on a combination of QuickBooks plus manual methods of generating, sending and reconciling invoices often see the best results from automated invoicing implementations. The typical accounts payable (AP) clerk, for example, may receive hundreds of vendor invoices
in bulk, all of which must be manually keyed into a system. The invoices must then be sent through an approval routing process involving other personnel.
“In many cases, companies simply don’t have enough personnel to actually process all of their transactions or invoices quickly,” said Sunil Nelabhotla, Founder of Skalable Technologies Corp. “As the volume of invoices grows, the errors, delays and duplicate invoices increase right along with it.” By automating the invoice process, the same organizations can minimize the amount of time spent on daily invoice management, reduce file storage costs and simplify a labor-intensive process.
In this white paper, we explore the key pain points associated with invoice management and show how an artificial intelligence-driven automated invoicing solution that ties directly into an enterprise resource planning (ERP) system helps companies save time, improve visibility, reduce errors and eliminate duplicates.
Grab a seat and enjoy. Read Time: 4 minutes
The High Cost of Invoice Management If manual invoice processing is costing your business money and consuming valuable man- hours, you’re not alone. According to the Institute of Finance and Management (IOFM), it costs an average of $12.90 to process a single invoice. For invoices without purchase orders (POs), that price goes up to $18.00-$25.00 per invoice. The downsides of manual invoice processing extend beyond the financial burdens. Other key challenges include the higher processing errors, poor cash flow visibility, poor spend management, excessive exceptions, the risk of fraud and the prevalence of fragmented systems, IOFM reports.
To offset these challenges, reduce costs and improve discretionary spending management, more organizations are turning to automated invoice processing platforms for help. “Automation enables accounts payable departments to: extract data from invoices received in any format from any location, match invoices with purchase orders and/or services and goods receipts, electronically route invoices based on pre-set rules for approval and exceptions handling, post data on approved invoices to downstream systems, initiate payments to suppliers, and provide reporting,” IOFM states in its report. “Importantly, automation manages both purchase order (PO)-based and non-PO-based invoices, as well as check requests.”1
Invoice automation also eliminates manual processes like downloading attachments, reconciling PO or supplier information, document scanning, keying in data, and searching for lost invoices—all of which can consume hours each day for the typical finance department. “All of these steps add time and complexity to what could be a very streamlined, straightforward workflow,” Nelabhotla explained. “The end goal is to pay your vendors, but when that doesn’t happen the business itself can be adversely impacted.”
Say, for example, an invoice arrives and is immediately scanned into a basic accounting system and then sent out for approval. That invoice may sit in the “queue” for days, waiting to be approved. As the clock ticks on, the payee misses out on the opportunity to leverage discounts (e.g. 1% Net 10 terms), vendors are wondering where their payments are and suppliers may halt new orders until older invoices are cleared up.
Integrating directly with NetSuite, Skalable Stream receives invoices and then drops them directly into the appropriate approval process. It then manages the approval flow, creates an accountability trail that can be shared with vendors online and connects the entire lifecycle of the invoice into the NetSuite cloud enterprise resource planning (ERP) platform.
The franchisor that has 30 different franchisees, for example, will typically pay vendor invoices through a centralized corporate hub. When an invoice is sent both to the franchisee and the franchisor, however, it could result in a duplicate payment (when both entities pay it). By adding automation to the equation, companies can require the appropriate franchise manager to approve such invoices, which in turn will be submitted for payment one time.
“Skalable Stream captures invoices via email (or via a scanned or uploaded file), finds out exactly who needs to approve them and routes those invoices to the right franchise managers for approval,” said Nelabhotla. “Then, it drops the files into the specific franchise bucket within NetSuite.” This streamlined AP process reduces processing time and complexity while reducing the $12.90-$25.00 that it takes to handle a single invoice from receipt to payment.
1 Institute of Finance and Management (IOFM), Special Report: The True Costs of Paper-Based Invoice Processing and Disbursements
Using NetSuite and Skalable Stream™, companies can vastly improve and speed up the AP process while also saving money.
https://www.oracle.com/legal/copyright.html https://www.oracle.com/legal/privacy/index.html https://www.iofm.com/ap/process-improvement/automation/special-report-true-costs-paper-based-invoice-processing-disbursements
What’s the Tipping Point? For most companies, growing invoice volume is the tipping point that pushes them to find an automated solution. Seeking an easier way to manage this aspect of their businesses, these organizations usually find what they’re looking for in automated solutions like Skalable Stream. Those firms that already have a cloud ERP like NetSuite in place can be up and running with Skalable Stream within four to six weeks. Those that are using a basic platform like QuickBooks—and that are upgrading to a cloud ERP—may require more time to get their new system in place.
Using artificial intelligence (AI), Skalable Stream processes high-volume AP transactions and turns a traditionally complex and time-consuming process into a simple one. Managed from one lifecycle tracking hub that seamlessly integrates to NetSuite, Skalable Stream helps companies that have thin accounting staffs deal with large volumes of vendor invoices or complicated approval processes (e.g. those with multiple departments or subsidiaries).
For local, independent gym West Coast Fitness, Skalable Stream has become a vital tool for managing the organization’s vendor invoices. “Skalable Stream will take out typing time, emailing (sometimes multiple times for one email), should
provide clear reporting so we also know the status of all received invoices, and after processing, the PDF copy of the invoice is available, saving time that would otherwise be spent searching for invoices,” said CFO Clint Weiler. “In short, we expect to get more done, more accurately, with fewer people.”
Racking up the “Wins” Once Skalable Stream is in place, the “wins” begin to surface quickly. For most companies, the first benefit comes in the form of no longer needing dedicated AP resources to handle vendor invoices. Because the system is 100% hosted and driven by AI, it frees up internal resources to focus on more important projects. Finally, the company’s CFOs and controllers gain instant access to information that they once had to ask an AP manager for. “They get visibility into the invoice pipeline from where they’re sitting,” said Nelabhotla, “and can use that intelligence in their planning.”
Other key benefits that Skalable’s customers experience include lower invoice management costs and easy onboarding of new vendors. Another win that not all customers expect—but that all of them appreciate—can be found in Skalable Stream’s data generation capabilities. One controller, for example, didn’t realize that he could use the platform as a cash flow management tool.
“The controller is using the raw data coming into the system from a cash flow perspective and to basically see what payments are coming due and when,” said Nelabhotla, “instead of waiting for that data to hit the company’s ERP. That was a real eye- opener for him.”
“No other invoice management application manages each invoice lifecycle in one main hub thus eliminating the need to engage multiple applications or do hundreds of hours of da