In our previous post, we looked at the following components that effective Accounts Payable Software needs to have:

Electronic Document Management

Automated Electronic Workflow

Intelligent Advanced OCR Technology

In addition to these core items we told you that we’d cover the following four to round out the necessary components to process transforming Accounts Payable software:

Business Intelligence Systems

Invoice Submission Systems

Vendor Portals

Audit Utilities

So let the fun begin:

Business Intelligence (BI) Systems

Business Intelligence - The Brain of Accounts Payable Software

Business Intelligence within AP is imperative to effectively routing invoices into the appropriate processing flow.  For PO based invoices, the best practice to efficient processing entails extracting both the header and line item detail necessary to advance the processing.  With the line item detail extracted off the invoice, all the necessary data elements are able to be utilized and pushed into the ERP/Accounting system where auto 2/3 way matching can occur.  Fields including the Item, Description, Quantity, Price, Measure, etc. can be mapped to the appropriate spot within the ERP and most of the time this is achievable by way of an 810 ANSI EDI file (standard invoice file type for EDI transactions).

Business Intelligence within Accounts Payable Software also, will drive the automation of Non-PO invoice routing so that the invoices get to the appropriate approver and GL coder.  This is typically done by way of extracting header level information (often by vendor, location, or addressee).   Most companies deploy some type of hierarchal approval controls whereby different levels of approvers in the organization have different levels of financial authority to clear an invoice for payment.  BI escalates invoices according to the organizational controls to ensure that invoices have the necessary digital signature before final approval and release for payment.

Last but not least, BI is a value add to invoice entry accuracy from a financial perspective. On the fly math-checks of invoices can occur to ensure that invoices correctly tally to the Net amounts, even factoring in variables like Tax and Freight.  This can greatly reduce invoice errors and prevent overbilling.  Additionally, duplicate payments, vendor mismatches, PO number mismatches, and other exceptions can be flagged by way of Business Intelligence in AP, empowering AP staff to more quickly bring outlier invoices to resolution.

Invoice Submission/Vendor Portal Systems

 accounts payable software vendor portal

Many organizations are open to doing away with paper in their AR and AP processes, and as such, Invoice Submission is a key area where Accounts Payable Software can make significant inroads to your supplier base.  By offering them the ability to self-serve and submit invoices to you electronically via a Vendor Portal (or of course e-mail/fax), you enable them to get their invoices across faster, more reliably, and far more cost effectively than postal mail.  Essentially, any AP software worth its mustard will have the flexibility to ingest multiple file formats including EDI, PDF, Tiff, Physical paper so that the spectrum of communicated invoice documents can be assimilated into the system and processed accordingly.  If your software can’t handle multiple file types, by default, you’ll have to maintain separate processes to onboard invoices into your system.

The other implication of a Vendor Portal system is that vendors gain the added luxury of being able to self-serve and check on their submitted invoices to determine the status.  This has the direct benefit of reduced inbound call volume to AP for the organization deploying a Vendor Portal.  Many suppliers just want to know that invoices were received, where they are in process, and shockingly, when they will get paid.  A robust Vendor Portal will empower the supplier to check on these items in a smooth user interface.  It’s important to add that there needs to be escalation within the Vendor Portal system, so that in the event the supplier can maintain connection with AP in the event they can’t resolve their issue.

Audit Utility

accounts payable software audit utility

Finally, after the invoice has been processed and paid, the only real interaction that invoices tend to receive comes in the form of an Audit.  Many Accounts Payable managers find this process challenging and burdensome and are open to ways to improve it.

Essentially, the Audit Utility should be an environment whereby an Auditor (Internal/External) should have limited access to the Electronic Document Management component of the Accounts Payable Software.  AP supervisors and managers should be equipped to publish specific invoices or invoices by vendor type, GL code, date range, amount, etc to a designated repository within the EDM.  From this unique place, an Auditor is free to examine all the invoices and metadata associated with them in a view that is unique to the auditor, without having to burden the AP staff to dig through boxes of invoices, produce copies, and suffer through Auditor coffee breath (;-p).

Again, if your current or potential Accounts Payable software does not have these components, then it may benefit you to consider updating it to a more comprehensive Accounts Payable solution.

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