the benefits of automating ap invoice and purchase order...
TRANSCRIPT
The Benefits of Automating AP Invoice and Purchase
Order Operations
Presented by
Dan Humbert Chrome River, Product Manager
1. Benefits of automating AP operations
2. Benefits of integrating within your automated AP processes
3. Demonstration of Chrome River INVOICE and PURCHASE ORDER
Today’s Objectives
• Sits “in front of” your financial system’s AP module
• An invoice image repository with powerful workflow and compliance capabilities
• Leverages data from your existing systems (GL’s, matters, vendors, people, etc)
• Makes all of this data available online in an intuitive, user-friendly manner
What is AP Automation ?
Receive an
Invoice from
a vendor
Create an
INVOICE
Record
(Add an image,
enter
data into CR)
Invoice
enters workflow in CR for
added data, compliance,
routing, review, updates,
and approval
Approved
Invoice
exported to
your ERP for
posting &
payment
Paid
invoice
data
update
Standard “Non-PO” Invoice Process
1. Increased Visibility and Tracking • Images are online – visible to AP as soon as they are imported • Track invoice status – for approvers and suppliers
2. Systematic Policy Enforcement and Controls • Approvals – ensures you are not under OR over approving • Allocation and data entry rules can be distributed
3. Enhanced Productivity • Easy to enter and easy to approve an invoice • Use workflow instead of email/interoffice-mail/phone
4. Analytics on Spend and Processing • Leverages technology to capture and report on metrics
4 Benefits of AP Automation
• A Purchase Order (“PO”) is pre-authorization to buy goods and/or services according to agreed upon terms and prices
• A PO Number uniquely identifies each Purchase Order
What is a PO ?
Need
to buy
something
from a
vendor
Create a PO
Record
(Add an image,
enter data
into CR)
PO Request
enters workflow in CR for
added data, compliance,
routing, review, updates,
and approval
Approved
PO Request
converted to a
Purchase
Order
PO document
sent to Vendor
to authorize
purchase
Standard PO Creation Process Step 1 of 2
Customer
receives
Vendor Invoice
referencing PO
Customer
scans invoice,
and copies PO
data into
invoice
Invoice enters workflow in
CR for added data (if
needed), compliance,
routing, review, updates, and
final approval
Approved
Invoice
exported to
FinApp for
payment
Paid invoice
data update
back to CR
Invoice
MATCHES
PO
Invoice routes for
approval rules
Invoice
DOES NOT MATCH
PO
Invoice routes for
exception rules
Standard Invoice Match to PO Process Step 2 of 2
• Invoice Matching is the process of comparing the Invoice Received to the PO that it references
• Two-way matching: PO and Invoice
• Three-way matching: PO and Invoice and Receipt
• “Matched” invoices are ready to be approved
• “Unmatched” invoices have some exception to be resolved
What Do We Mean by “Matching” ?
1. Enables “Asking for Permission” vs “Begging for Forgiveness”
2. Holds your suppliers accountable to agreed upon terms
3. Enforces the use of favorable terms negotiated with preferred suppliers
4. Provides visibility into committed spend (the future) vs invoiced spend (the past)
5. Your Suppliers may require it
6. Matching an invoice to a PO makes AP’s job MUCH easier
6 Benefits of Using a PO
Issues to watch out for with POs
PO’s can • Make legitimate purchases too difficult
• Have material administrative overhead
• Become confusing
• Be ineffective
Potential Result • They can incentivize suppliers and their customers
(your users) to “work around” the PO process
It does NOT have to be this way; PO’s can be a VERY useful tool.
PURCHASE ORDER Demo
1. Create a PO in the system and submit it
2. Create an invoice that “matches” the PO and submit it
3. Create an invoice that does NOT “match” the PO and submit it
4. Show how a Procurement organization can Manage the PO’s and invoices that reference them
Questions?
