Invoice processing can simplify the accounts payable process, making it a worthwhile investment for middle-market businesses. That said, many accounts payable team managers may wonder, how exactly does it work, and where does AvidXchange enter the picture to help your business optimize its invoice processes?
What is Invoice Processing?
At the core, invoice processing involves managing and maintaining the flow of documents from vendors or suppliers to buyers. It includes a series of steps that start from receiving the invoice, continue till making the payment, and finally marking it in the accounting records. One might think of it as the circulatory system of a company’s financial health. A key aspect that we must touch upon is the importance of accuracy. Every step in the process requires meticulous attention to detail. Even the tiniest error can lead to financial discrepancies, uneasy supplier relationships or worse, legal complications. As organizations grow, manual invoice processing becomes impractical and error-prone. That’s where an invoice processing system steps in. Right from digitizing invoices to streamlining approval workflows, these robust solutions equip businesses to handle invoice processing with ease and proficiency.
What is an Invoice Processing System?
An invoice processing system helps expedite the accounts payable cycle, providing a more efficient way to get invoices through the processing pipeline. The typical accounts payable cycle involves several different steps an invoice must pass through, such as data capture and approval. Digitizing your payment process helps reduce the amount of paperwork that your accounts payable team must manage and process. Many middle-market companies today may find that they prefer using an online invoice system rather than having to manage and process so many invoices manually, which can take time and resources away from other pressing business matters.
An invoice processing system can be more secure than more traditional methods of managing accounts payable. Having invoice payment information accessible via a centralized, online platform could reduce the risks that may be associated with sending out paper payments and invoices. An invoice processing system can allow AP teams to access the information they need from any location, so long as they have an internet connection and a functioning device.
Billing and Invoice Process
Although the billing and invoicing process can prove challenging for many middle-market businesses, certain software may be able to remove some of the guesswork associated with various types of payments and invoices. In addition, some companies may opt to use a billing process flow chart that outlines the specific procedures to be followed in order to make the process run as smoothly as possible. Having a detailed set of billing process steps to refer to can make things easier, whether you are using a manual or an electronic processing system. The billing process in accounting can be made especially easy this way, and those in charge of managing payments appreciate having access to a complementary software system that aids them in their existing operations.
Invoice Processing Procedure
The standard operating procedure for invoice processing typically follows a certain invoice processing cycle in which an invoice is received, scanned, filtered through the appropriate channels, and sent to an administrator for approval. However, accounts payable teams can possibly speed up the invoice processing procedure with an automated system.
There are a number of benefits associated with automating your invoice processing procedures. First, following these accounts payable process steps with automation can improve visibility into your invoices. In fact, automating accounts payable can provide 24/7, remote access to your payment data. This is especially useful for companies with a largely remote or hybrid workforce. That way, your accounts payable team can view the statuses of invoices at any time. Second, this type of technology allows for more efficient processing overall, reducing or potentially eliminating reliance on large volumes of paperwork and processing paper invoices.
Automating your billing procedures also helps cut costs. Managing excessive amounts of paperwork, physically getting invoices to an approver, filing the invoices, and then searching for them for auditing can be costly and time consuming. Automating these procedures, on the other hand, could allow your company to reduce the volume of paperwork your business must handle. It could also provide opportunities to earn rebates from paying suppliers electronically rather than by check, which could potentially save your business money.
Automated Invoice Processing System
When we talk about automation in invoice processing, what exactly are the dividends? A major payoff is time savings. An automated invoice processing system uproots redundant tasks, speeds up procedures, and thereby, very tangibly, frees up time. Reducing errors is another significant benefit of automation. As humans, we are prone to make mistakes, particularly with repetitious tasks. Automated invoice processing, being less reliant on human input, dramatically cuts down the occurrence of such slip-ups. Enhanced visibility into the entire invoice processing cycle is a valuable perk that comes with automation. Digital systems offer real-time views of the process, empowering decision-makers with data and insights, which manual processes may not provide.
One of the best ways to make the most out of your automated invoice processing system is to integrate with third-party applications. By doing so, you can better streamline your payment processes, taking advantage of external tools that may not be accessible within your organization. The best automated invoice processing system is one that can easily adapt to various platforms and evolve alongside their users’ needs. This is one of the main reasons why invoice automation software benefits from third-party integrations.
AvidXchange currently offers over 225 software integrations to users. It has partnered with SAP Concur Invoice to deliver user-friendly, flexible payment automation solutions built to help businesses eliminate risk-prone, inefficient payment processes and pay bills more easily. This SAP automated invoice processing system is great for all businesses. AvidXchange has also integrated with Oracle JD Edwards. The automated invoice processing Oracle integration helps users incorporate easier, faster, and more secure ways to process invoices and make electronic payments. AvidXchange’s integration with Oracle PeopleSoft brings yet another great automated invoice processing software to the table. AvidXchange offers PeopleSoft users payment solutions that help them discover how to transform their payment departments into profit centers through a rebate program.
Invoice Management Process
The invoice management process does not necessarily have to be a time-consuming affair. In the modern business world, middle-market companies can benefit from adopting digital invoice processes. An invoice management system can run more efficiently if it is converted to electronic form, and there are a number of different features you can take advantage of with this type of software as opposed to a more traditional system for billing processing.
It can also be helpful to implement invoicing policy and procedures with your payment operations. This can make it easier for your teams and vendors to understand different billing features, how invoice processing works within your organization, and how to keep things moving according to schedule. Vendor invoice management can be handled exceptionally well with an automated system, but it is important to have a thorough understanding of your company’s existing policies and procedures to determine where and how this technology might fit best into your workflow.
Vendor Invoice Processing Checklist
Invoice processing software can help enforce the internal controls of your accounts payable department. At the beginning of the invoice checking process you can automate invoice matching to check if information from the invoice matches your purchase order. This is just one example of what software can track during invoice processing to limit human errors and catch more mistakes automatically. Creating a vendor invoice processing checklist can also help simplify vendor invoice processing. It can help you ensure that you aren’t skipping over any information and keep your processes aligned with whatever plan or defined steps you set prior to implementation.
Likewise, an invoice verification checklist might be useful for keeping track of the invoices that have been verified and those that still need to go through the approval process. To do this, accounts payable teams may draw up an invoice audit checklist to keep processes running smoothly when it comes time to conduct audits on your billing and invoicing systems. You might also devise an accounts payable checklist template to better organize your methods for paying your vendors.
About AvidXchange Invoice Processing
AvidXchange can help simplify the process of receiving, tracking, and approving invoices via a single digital platform, while in turn ensuring that suppliers can be paid on time. AvidXchange offers billing processing software that could allow middle-market companies to streamline invoice processing. More specifically, this software could allow users to automate fast and secure B2B bill payments backed by AvidXchange’s robust supplier network. This network contains around 700,000 suppliers.
AvidXchange’s software could also enable users to create custom workflows with 24/7 visibility into bill payment status and approvals. This could ensure that your accounts payable team can keep their current systems and software in place while still reaping the benefits of efficient invoice processing. Middle-market businesses could also reduce bill payment processing costs by eliminating check printing, envelopes, postage, and time spent following up on uncashed checks.