Gone are the days when invoice processing meant piles of paper, manual entry, and a high risk of mistakes. In our digital era, automated invoice processing is revolutionizing the way companies manage their finances. This technology simplifies the entire process, from receiving an invoice to recording it in the accounting system, with minimal human intervention.
This article will walk you through the journey of invoice processing from past to present, highlighting the benefits of automation in saving time and increasing accuracy.
What Is Automated Invoice Processing?
Automated invoice processing is an easy and efficient method that eliminates the manual aspects of accounts payable (AP). This cutting-edge technology uses software to automate the entire process, making it more accurate and faster. Further, AP automation tools let you digitally submit and approve purchase orders and invoices. Moreover, it minimizes the necessity of manual handling, thereby reducing the chances of human errors.
The accounts payable system has been revolutionized with automated data extraction and invoice matching. This technology extracts invoice information and integrates it into your current systems, reducing the need for manual data entry and mitigating the risk of errors.
Additionally, the right invoice management software can enhance the visibility and control of your entire AP process. It leads to a more streamlined and efficient process from which your finance teams can benefit.
How Does Traditional And Automated Invoice Processing Work?
Traditional invoice processing involves:
- Receiving invoices from suppliers.
- Verifying them against the goods or services received.
- Updating payment details.
- Sending them for approval.
Automated processing follows the same workflow but eliminates repetitive manual tasks, reducing errors and delays. It involves scanning and uploading the invoices and extracting relevant data. Likewise, it also verifies invoice accuracy and updates payment details. Again, automating invoice processing saves time, reduces errors, and revs payments.
The automated invoice processing workflow is as follows:
- When an invoice is received, it is automatically scanned, and its details are entered into the digital accounting system in the desired format.
- After the data is recorded in the digital database, the invoice is converted into a text-searchable document managed by an automated management system. It allows the data entered into the system to be actively tracked within the ERP system.
- The data stored includes the supplier name, purchase amount, and details of the goods or services provided and produces a complete and well-formatted invoice. Concerned parties can review and approve payment by accessing this account.
- If any captured detail does not pass data validation checks, it is held for manual review. Otherwise, the processed invoice is assigned to the person liable for approval and payment.
Key Benefits Of An Automated Invoice Processing For Your Business
Automating the invoice process can provide finance teams with numerous benefits. Investing in accounting software is a significant expense. However, it can yield substantial returns depending on the software you select and your company’s needs. Automated invoice processing can improve your AP unit and other areas of your company.
So, here are some ways that AP automation might enhance your organization:
- Spend less
Automating the invoice processing cycle eliminates the need for human intervention. This, in turn, can result in a reduction of expenses by up to 90%.
- Improved productivity
Automating the invoice processing flow frees accounts payable professionals from low-value manual routines. This, in turn, increases team productivity by a factor of four.
- Efficient payment processing
Automation can reduce invoice processing time from 45 to less than five days. Similarly, it can also complete specific procedures up to 12 times faster.
- Reduced rates for early payments:
AI-powered suggestions can help large businesses reduce expenses by 1-3%. These recommendations offer the best way to pay invoices, decreasing payment delays and increasing vendor discounts.
- Enhanced precision
By automating invoice processing, you can minimize inconsistencies in invoices and payments. Not only does this help reduce human error, but it also streamlines reconciliation and payment planning operations.
- Streamlined compliance
Automated invoice processing ensures compliance with legal requirements and makes passing financial audits easy. It simplifies the process by streamlining checks and improving your readiness for audits.
The Must-Have Features For Automation
- Multiple channels for invoice capture:The program should allow vendors to choose from various formats to send invoice data, such as PDFs, computer invoices, scanned copies, paper invoices, and XML files.
- Intuitive user interfaces:The invoice software is designed intuitively, making it easy for anyone without extensive training.
- Integration:The software for automating invoices must work with other financial systems without problems. Integration with other accounting systems lets verified data into ERP systems already used.
- Customization:Invoicing software must be customizable to meet the specific needs of each business. The program should be flexible and versatile to adapt the different rules for sending invoices to the correct persons across companies.
Transform Your Invoicing Process With Extracta.ai
We are excited to present Exracta.ai, a software solution that simplifies traditional AP tasks and makes invoice processing more efficient and cost-effective. Our system replaces outdated invoicing methods and streamlines the process of handling procurement, payments, and other related tasks.
Moreover, automated invoice processing enables your organization to increase cash flow while reducing liability risks. Efficiently managing debts frees up time for other company-advancing projects, benefiting everyone, not just the finance teams. We are confident that our software will transform your invoicing process, making it more efficient and hassle-free. For more information, contact us!