In the past, the lengthy procedure of processing invoices was something that businesses were used to doing in their daily operations. The procedure used to be time-consuming and fraught with errors, but things have become far less complicated in recent years. When you automate the procedure of processing invoices, optimizing the operations of your company and saving countless hours of work will be much simpler tasks than they have ever been in the past. Before we dip into details of invoice processing lets recall some invoices basics such as invoice meaning and review how to write an invoice.
Invoice definition is best described as a time-stamped commercial legal document that itemizes and records a transaction between a seller and a buyer. In simpler words, invoice meaning is an official document that is provided by the seller to the buyer to collect the payment for the provided goods or services. Invoices list the prices of the purchased products or services provided to the buyer.
The accounts payable department is responsible for the business function known as invoice processing, which, by definition, is a business function. It is composed of a series of processes for managing vendors, and the records of these activities are documented in the general ledger. These operations begin with the receiving of an invoice from a supplier and end with the payment of that invoice. Invoice processing often involves the use of software, a procedure that is commonly known as invoice automation or automated invoice processing. Both of these terms refer to the same general activity. A flowchart is a structured guide that outlines the processes of how accounts payable is to handle vendor bills. A flowchart for invoice processing is a visual representation of this guide. The world of finance is one that makes frequent use of flowcharts.
When you handle invoices, you are responsible for seeing to it that they are attended to from the moment they are received to the point at which they are paid for. Invoices can be created in a wide variety of formats, and there are many options accessible. In general, invoices can be divided into two categories, which are as follows: Invoices that are associated with an internal request or purchase order that was positioned by a company, as well as invoices that do not have a request that corresponds to them.
People often ask how to write an invoice. If you use accounting software, you can use the system’s invoice generator. Usually, an invoice generator is part of most accounting systems. If your ERP system doesn’t include an invoice generator, then you can create the invoices by using one of the invoice templates provided below. You can download any invoice template you like and adjust it to your specific needs. The simplest way to start is probably to use an invoice template in Word format. Because if you use a PDF template format, you need to have Adobe software or any other PDF editor program installed on your computer to edit the template. If you use a template if Word format, then you can easily modify it and convert it to a PDF file after you are done with the invoice creation.
If you need a different invoice layout to create an invoice, then you can use the free invoice template from Canva or you can use the free invoice generator tool with online templates from Adobe. Invoice maker tools from Canva and Adobe provide access to thousands of free invoice templates and you can easily find the layout you need for your business.
The following is a rundown of each step involved in the processing of invoices:
Implementing an Automatic Invoice Collection Solution
The first step in the process of automating invoice processing is the installation of a system that collects invoices automatically. Invoicing software is another common name for these kinds of solutions. They provide you with the ability to automate the process of invoice scanning or receiving it as an e-mail attachment, and then extracting its contents with the help of OCR technology. In addition, they give you the ability to automate the process of organizing all of your invoices (Capture all payment details digitally). Utilizing optical character recognition (OCR) software that has been specifically trained to read invoices will make the process of collecting, centralizing, and approving the bills that your company must pay a snap.
Validating and Normalizing the Invoice Data
It is vital that the structure and content of the invoices are confirmed prior to any attempt being made to automate the processing of the bills. This is due to the fact that invoices may be received in a number of forms from a range of sources. As a tool for managing invoices, a significant number of companies today rely on spreadsheets to organize their data.
However, because they were not built with this particular function in mind, utilizing them can be a nuisance, particularly when dealing with a number of different types of invoices. This is because they were not developed with this particular function in mind. You can easily check and standardize invoice data in order to make it more consistent all throughout your business if you use an automation platform like Artsyl docAlpha with InvoiceAction solution.
Creating an Automated Invoice Processing Workflow
In order to begin automating your workflow for the processing of bills, the first thing you will need to do is build an automated workflow that will handle all of the steps that are a part of your process. This may involve tasks such as collecting, controlling, validating, and posting bills to the accounting software. As a consequence of this, as soon as your invoice is received, it will be promptly and automatically processed.
Establishing the Rules and Triggers
After you have laid the groundwork for your automated process, the next step is to begin adding rules and triggers that, when certain conditions are satisfied, will cause certain actions to be carried out. When an invoice is paid close to the due date, a client should be contacted through phone or email to determine whether or not the payment has been received. In the instance that a customer has not paid an invoice in time, a reminder email should be sent to the customer.
Making a Dashboard with Graphs to Keep Track of Key Metrics
Make a dashboard that has a variety of different types of visualizations in order to keep track of vital information such as the current payment status and the age of bills that have not been paid. This will offer you an overall view of the state your firm is in and assist you in spotting potential challenges in their early stages before they progress into more severe problems.
Optimizing Invoice-Related Tasks
Artsyl Technologies develops software that enables businesses to automate their invoice processing with InvoiceAction and provides payment automation with ArtsylPay, to minimize the need for human invoice handling and to save money on transaction fees, gain maximum savings from early payment discounts, and efficiently and securely centralize your invoices processing. After the data included in the document has been examined and approved at each level, it is then exported to an ERP system for further processing. Because Artsyl is integrated with the enterprise resource planning (ERP) systems, the entire process, beginning with document capture and ending with its export into the ERP and payment, is carried out on a single, cloud-based platform. Contact us for the invoice processing demo.