Invoice processing refers to handling a supplier invoice, from its receipt to when it has been posted in the ERP system and is ready for payment. Invoice processing is handled by the accounts payable (AP) department within an organization.
Supplier invoices are often received in a variety of different formats – paper, PDF in email, e-invoice, EDI etc. The invoice data must be digitized and transformed into a standardized format. In some cases accounts payable staff will manually key in data to the finance system. But today, most companies use an accounts payable (AP) solution with automated invoice scanning and invoice data capture functionality. This means the solution will automatically extract the invoice data so that the AP staff can spend their time on more valuable tasks.
The invoice amounts are then coded to the correct G/L account, project, and cost center. Then, the invoice is distributed to the responsible buyer or budget owner for review and invoice approval. With an AP invoice automation solution, this entire invoice processing workflow can be digitized and automated for faster and more efficient invoice processing.
To understand invoice processing meaning, it’s important to learn the different steps of the invoice processing process.
The invoice processing procedure starts with the reception of a supplier invoice.
In order to process invoices in a digital workflow, the invoice data needs to be extracted and captured in a standardized format.
The accounts payable team is responsible for invoice handling and will then apply accurate coding either manually or automatically using an AP automation solution that is pre-configured with the specific organization’s business rules.
The invoice processing continues with invoice approval. This part of the invoice processing procedure differs depending on the type of invoice: expense invoice or PO-based invoice. For PO-based invoices, the invoice processing can be performed touchlessly using automated invoice matching through an AP automation solution.
Managing AP should be about strategy, not stress. Medius goes beyond basic automation by using AI to do the work –
so AP teams can wrap up on time and rest easy. Spend a few minutes with us to learn more.
