The Age-Old Problem: Cost Control
According to IBM, Gartner and Aberdeen Group, between
75-80% of invoices in any business or organisation, are
still processed manually - despite the advent of Electronic
Data Interchange (EDI). These days, sophisticated invoice
processing solutions are available to cut a swathe through
the time and costs involved in handling supplier payments
and to enhance business workflow.
Invoice Processing: The Real Costs
With a manual system, hundreds - often thousands - of
invoices must be reviewed and entered onto an accounting
system, at massive cost in terms of labour, time and
potential error.
Byline Group's research into Accounts Payable processing
has shown that 90% of Accounts payable invoice processing
involves keying data from paper; that the average time
taken to process and Accounts Payable invoice is 12 days,
and that 25% of all invoices are paid late.
Also according to Byline's research an accounts payable
clerk handles just 70 invoices per day on average. Thus it
is easy to put a labour cost on the front end processing.
But the repercussions are felt further down the line too.
Invoice Processing Solutions: Key Benefits
Invoice processing solutions comprise software to allow
invoice processing to be speeded up massively. This has a
great impact on reducing accounts admin costs associated
with invoice processing and also enables companies to make
best use of any time critical payment times which may
attract supplier discounts.
Automated invoice processing solutions allow a wide variety
of typical invoices to be scanned at the same time and for
them to be automatically reconciled against the original
purchase order with minimal user intervention or data entry.
In essence, an invoice processing system uses sophisticated
OCR (Optical Character Recognition) and data matching
techniques
Invoice Processing Solutions:
The Basic Principal - The best invoice processing solutions
will automatically scan, extract and validate invoice data
and feed directly to an accounting system. Invoices come in
a multitude of formats, layouts and styles from a wide
variety of different suppliers. They can be machine printed
or part handwritten, single or multi-page, coloured or
white paper, and come from home or abroad.
However, all of these can be handled simply by scanning in
a seed invoice and selecting the items of information that
you want to capture. This is done by defining a target zone
for each of them; the system will automatically distinguish
between the field label e.g. VAT amount and the associated
value. If you now select the supplier name as a unique
attribute of all such invoices, every invoice from this
supplier can automatically be recognised and processed and
the captured data sent straight to the accounting system.
Sophisticated Functionality
The challenges of identifying columns and lines of
information, knowing where one item description ends and
another begins, handwritten information, validation against
almost any criteria or data values - all these are the
remit of sophisticated invoice processing systems today.
Managing digitised invoices through the entire workflow
approval process offers the potential for even greater
efficiency and cost savings, and so it pays to check out
software providers who can offer an interface with
purchase-to-pay (P2P), Enterprise Resource Planning (ERP),
Electronic Content management (ECM) and Document Management
(DM) to offer integrated workflow solutions.
Invoice Processing: Summary Benefits
1. Removes the need to handle and store large volumes of
paper
2. Increases staff productivity and reduce processing costs
3. Faster invoice processing improves supplier relationships
4. More up-to-date position of the business/organisation's
financial position
5. Reporting on all financial transactions assists with
compliance to appropriate Accounting Standards
----------------------------------------------------
Jimi St. Pierre writes for several Office IT Equipment
suppliers in the UK, including document management systems
supplier Principal. The Principal Office IT Systems website
can be found at => http://www.principalcorp.co.uk/
No comments:
Post a Comment