Accounts payable automation is technology that digitizes and streamlines the receipt, processing, and posting of paper and electronic invoices submitted by suppliers. The technology automates tasks such as:

• Capturing invoice header and line-item details
• Matching invoices against purchase orders (POs)
• Digitally routing unmatched invoices or invoices that require review for approval
• Posting approved invoices to the buyer’s enterprise resource planning (ERP) platform or accounting software package

The best accounts payable automation solutions also provide expert-assisted services for resolving invoice exceptions. By automating invoice data capture and other invoice processing tasks, AP departments can decrease operations costs, reduce the possibility of errors, accelerate invoice approval cycle times, and gain visibility into invoices from the point they are received.

Accounts payable automation solutions provide significant operational and strategic benefits to organizations of all sizes, across all industries. Eliminating manual, repetitive invoice processing tasks such as keying invoice data and shuffling paper and emails reduces the average cost to process an invoice submitted by a supplier. According to the Institute of Finance and Management (IOFM), highly automated accounts payable departments spend less than one-fourth as much, on average, to process a single invoice compared to their peers with little or no automation.

Accounts payable automation also improves staff productivity. Highly automated AP departments process eight times as many invoices per full-time equivalent (FTE) as their peers with little or no automation. And accounts payable automation reduces the average amount of time it takes to approve an invoice. Highly automated accounts payable departments approve invoices in less than one-fourth the time it takes their less-automated peers. As a result, highly automated accounts payable departments capture seven times as many early payment discounts as their peers with little or no automation. These benefits are the primary reasons that more organizations are automating their invoice processing.

AP automation solutions use advanced technologies to digitize and streamline the processing of invoices submitted by suppliers.

1. Invoices sent through the mail are received on the buyer’s behalf, digitized, and aggregated with emailed invoices.
2. Invoice header and line-item details, such as the supplier’s name, the amount of the invoice, and the invoice due date, are automatically extracted with guaranteed 99.95% accuracy.
3. Invoice data is then matched against purchase orders (POs). Matched invoices are posted directly to the buyer’s enterprise resource planning (ERP) or accounting software. Unmatched invoices and invoices requiring review are digitally routed to the appropriate individual, based on pre-defined business rules.
4. Subject matter experts employed by the solutions provider take the first pass at resolving any invoice exceptions.
5. Once supplier invoices are approved, they are posted for payment.

Throughout the process, accounts payable staff can see the status of invoices.