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Leverage the Rule of 3 for Improving AP Automation Accuracy

This sponsored Viewpoint article has been provided by Corcentric
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e-invoicing

We’ve all heard about the benefits of accounts payable automation: going paperless, saving time and saving money.

If you and your team want to truly maximize these benefits, there are important considerations to make  when looking for an AP automation solution. Above all, you must make sure the solution you select offers true automation so less human intervention is necessary. Sticking to the basics often gets overlooked in pursuit of the most cutting-edge capabilities.

In this regard, here are three things you should consider to ensure you’re getting true AP automation:

1. Invoice Digitization Accuracy

If your accounts payable department is similar to the majority of AP departments, you probably receive invoices in a variety of formats (e.g., paper, email, PDF, EDI, etc.). It is critical that your solution is able to accommodate an assortment of formats during the digitization process and is able to index the information accurately. A highly accurate digitization process is critical to ensure that you and your team have fewer exceptions to handle.

The difference between a 90% and 99.5% accuracy rate might sound inconsequential, but on closer look the difference can be monumental. For example, if your team processes 10,000 invoices monthly, the difference between a 90% and 99.5% accuracy rate is the difference between your AP team having to review 1,000 exceptions versus only 50 exceptions. The ability to accurately automate the capture and indexing of invoices leaves you and your team with more time for data analysis instead of data entry. If you automate your AP workflow and then still need to spend time reviewing and correcting digitized invoices, then you have missed an opportunity to truly automate.

Corcentric’s Invoice Virtualization Center can convert all invoices, regardless of format and turn  them into digital invoices that are 99.5% accurate. The Invoice Virtualization Center programmatically compares captured data to make sure that the information extracted is accurate. Invoices are reviewed by two quality assurance checks after the initial scanning process to ensure accuracy when capturing data. Customers can configure rules to handle any exceptions that may occur during the invoice capture process.

Exceptions identified during the comparison process are escalated for verification and final determination before the information is ever ingested into the system as an electronic invoice. This highly accurate process results in fewer exceptions and less human intervention for both your AP department and suppliers. Fewer exceptions means AP personnel can spend more time on strategic initiatives, such as analyzing cost, productivity and efficiency for the CFO and other C-level executives.

2. Smart Routing of Invoices for Review/Approval

After accurately ingesting your paper invoices into an AP automation solution, the next critical step to true automation is to make sure the invoices are routed intelligently to the correct approver. You want to direct the majority of invoices to the proper approver and not to the AP Department for manual assignment. To do this effectively, you should search for tools that allow you to set up rules to automatically route invoices for review and approval by a host of criteria. For example, routing by Purchase Order Requester, Vendor (Supplier), GL code, and even Invoice Amount is considered best in class.

Additionally, look for solutions that enable users to assign a “proxy” to review their invoices when they are out of the office. In this way, productivity will not stop. Empowering your users with the proper permissions and access to make the right decisions (how cash is being spent, how invoices are affecting budget, etc.) is also considered best in class. This not only improves productivity but is another indicator of true automation.

Corcentric’s configurable Smart Routing capability enables business rules to be created to route and manage both PO and non-PO invoices. Using attributes of the invoice, Smart Routing systematically drives invoice workflow. Invoices that require an approver, such as non-PO invoices, can be routed to the proper approver based on a variety of criteria, such as vendor, invoice dollar amount, department and PO requestor.

3. Automation of Periodic Expenses

Another area that needs to be considered is the ability to automate regular disbursements, like rent, taxes and utilities. It’s important not to overlook these expenses when considering AP automation, whether they include a PO or non-PO. A solution that offers true automation allows users to enter a regularly scheduled payment into the system only once for on-going approval. You should look for a solution that allows users to set the payment schedule, include GL account information and generate payments for approval without redundant invoice entry. Further, adding these regular disbursements to your AP workflow allows for complete visibility into your organization’s spend.

Corcentric’s Recurring Invoice module enables users to add these periodic payments into the workflow. Users can schedule a payment once, including the payment amount, payment frequency, whether it includes a PO or not, and GL codes and the system will automatically send the voucher out for approval at the designated time until the recurring invoice is deactivated. The system will even send confirmations once the invoice has been created or completed.

To reiterate, when looking for an AP automation solution, it’s imperative to select a partner that automates the complete process. Remember the three key areas to consider:

  1. Make sure your AP automation solution offers the highest accuracy rate for invoice digitization. This will ensure fewer exceptions and less human intervention in the process.
  2. Make sure your technology solution partner has the ability to route invoices to users directly using a variety of criteria. Avoid solutions that send invoices to a central repository that then has to be managed by your AP team.
  3. Finally, make sure your solution allows users to automate periodic expenses in order to eliminate repetitive tasks.

Corcentric’s Approval Workflow solution is able to meet all of these criteria and ensure true automation for our customers. To see how you can improve AP automation accuracy, contact Corcentric to schedule a no-obligation demonstration.

Kirstin Warner is Corcentric’s Product Marketing Manager.

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