How can you ensure invoice matching and approval is transparent?

"Automation has transformed invoice matching, easing tasks for staff and approvers. In my experience, it reduced manual efforts, ensuring smoother workflows and quicker approvals. This streamlined process not only benefits us internally but also strengthens supplier relationships and promotes transparency. Leveraging technology is crucial in our fast-paced environment, empowering focus on critical tasks while ensuring accuracy. So embrace automation, simplified the work and elevated transparency significantly."

I think there really good softwares out there, works well within the organization exiting accouting systems where it matches the POs with invoices, verify, post entries in accounting systems, also some softwares facilcilate the approval flow as well as give access to the portal for vendors where vendors can upload invoices and check the status of the invoices. Benefits are huge, streamline the process, minimize the errors and cost savings. Depend on the complexity of organization's structure, you may have to customize or add another piece of software to work well.

Automation nowadays is a big factor. Invoice matching and approvals would be easier for both staff and the approver. In my experience it helped me a lot to do my work easier

An automated 3-way invoice matching system can reduce the time considerably by setting up a streamlined workflow for the process, reducing errors, avoiding delays and late fees, Improving visibility/Improving vendor relationships, Providing live monitoring access and accurate reporting, freeing resources, and gaining the competitive edge.

From an auditor's point of view, invoice standardisation would be a great step. Even after having tools like datasnipper, the invoice testing and documentation is a challenge as different suppliers of a particular client have different formats. But on the other side, implementing this is something easier said than done. A supplier can't issue invoices in customized formats per client needs. It will affect his accounting. One possibile thing is to have state/nation wide structured invoicing format. Although the govts. of different nations prescribe the mandatory elements that should be there in an invoice but the formats are not structured. There should be a flexibility in designing headers and footers but the internal format should be same.

Standardization is done by several jurisdictions already for entity and tax identification purposes. This means audit can leverage standadisation to facilitate automated matching of the invoice

In my experience, the benefits of invoice automation go beyond efficiencies created by standardization of invoice templates and reduction of human efforts. Invoice automation provides a platform for enterprise resource planning and communication. The invoice automation system can be used to feed information to/from suppliers and cusomers, facilitating efficient and accurate purchase ordering and receivables management efforts. Invoice automation is a game changer!

In theory standard invoices are ideal from a client’s perspective in processing AP. But from the vendor’s perspective it’s a nightmare in processing AR. Speaking from experience clients can’t agree on what a standard format should be as everyone have different requirements. And you end up with multiple formats, which significantly slows down the invoicing process.

What I found useful is to have an invoice that contains details as prescribed by the tax authorities and audit requirements to ensure your organization is compliant to both is important.

Transparent communication with suppliers is pivotal for smooth invoice processing. Set up dedicated communication channels and provide comprehensive guidance in the submission process. Offering training, sessions or documentation helps educate suppliers, reducing errors and fostering a collaborative relationship. Implementing vendor portals facilitates real-time tracking, enabling suppliers to monitor the status of their invoices and fostering transparency.

It is helpful to apply the 80/20 rule and maximize on effective and streamlined B2B systems with major suppliers. APIs (Application programming interface) exist in some ERP systems to enable seamless integration with supplier systems such that purchase orders can be placed onto supplier sales order systems based on the realtime inventory requirements. Surprisingly for me, Bill Gates had great case studies of such integration systems in his book "Business @ the Speed of Thought" way back in 1999. Present day systems integration is becoming a basic standard by day and corporates aught to adapt as speed and efficiency is becoming more and more demanded by customers. And this in one way to be agile in delivering efficiency to customers.

Having continues communication with suppliers is a key factor to ensure obtaining best quality with reasonable prices. The communication can be very efficient by having routinely update from the vendors regarding their products and services, and keep communicating with the suppliers to be aware of the new technologies that is important for the company and the implementation. A visit to the vendors every while and then will also affect the business positively.

Suppliers are partners in your business that help you deliver goods and/or services to your customers hence it is important to keep all communication channels with them open. Building good relationships with your suppliers through constant communication builds trust and a harmonious environment.

While continual communication with vendors is ideal, it is not always feasible. In this fast-paced global market, automation not only reduces the possibility of errors and irregularities, but also streamlines routine procedures. I have a client that uploads invoice details to a customer portal. The portal is designed to have the vendor select a P.O., then enter invoice specifics. Upon submission, the appropriate parties are automatically notified for review and approval. As companies continue to improve and automate routine processes, more time is available for collaborative efforts with staff and suppliers to ensure successful business relationships.

Performance should be monitored and measured so as to track any variance or shortfall or inconsistency and also make corrections at a glance. During monitoring, the full invoicing process should be transparent to all stakeholders. You can use bespoke softwares that can be accessed by debtors and creditors.

I’m quite certain that this isn’t innovative and is simply the baseline for tracking the efficiency of the invoice process. However, when it comes to automation, I believe it’s even more applicable here to have meaningful KPIs that can’t be mismanaged.

The use of business intelligence and visualization tools such as PowerBI would be a great way to give visual transparency showing criteria such as the percentage accuracy of Purchase Orders matched to GRNs, percentage accuracy of GRNs matched to Invoices etc., this can be further broken down to a user’s needs by supplier, product types etc., and using these dashboards would allow for real time information (or refreshed at users discretion) and have the ability to pin point low performing areas to be discussed with relevant internal/ external stakeholders to make improvements and achieve the desired results.

To monitor and measure the performance will help to identify and correct the errors and further improvements required. Also it will help the internal and external stakeholders to further cascade the data as and when required.

Regularly monitoring and measuring performance is crucial. It enables identification and resolution of inefficiencies in the invoice approval process. Key performance indicators (KPIs) like invoice accuracy, cycle time, and payment terms help track and evaluate performance. Visualizing this data through dashboards or reports aids in sharing and understanding performance with stakeholders.

Stop training can never be overemphasized. Staff should be well trained to understand the processes and standards to minimize errors and encourage efficiency.

To ensure transparent invoice matching and approval, provide comprehensive training on your company's invoice processes. Empower staff with clear guidelines, access to relevant tools, and ongoing support. Foster open communication to address any questions or concerns, promoting a collaborative environment for efficient and transparent workflows.

Providing adequate and relevant training are vital, and also equally important is to have staff circle back on the processes, policies and controls that they may feel are insufficient/lacking or duplicate/redundant. Those closer to the process are much more likely to provide relevant feedback needed for potential improvements.

In my experience in the field of audit and corporate finance, I've seen firsthand the critical importance of transparency in invoice matching and approval processes. In today's fast-paced business landscape, fostering transparency isn't just about operational efficiency; it's about building trust and accountability. Having a centralized system, written documentation with internal audit follows up of the implementation of relevant controls with an iterative approach can help. Theoretically, there is a clash between the business reality and the procedure in place, the main issue faced is to align both, having a reasonable level of controls to achieve the matching and approval transparency in the process can be challenging

The competence of the Invoice /Receivable unit has to be checked regularly, they need to understand that their functions are a major gateway for CASH INFLOWS to the Company, As of facts, they are the lifeblood of the company since they manage the Cash inflows, as so they must understand the Timing of the Invoice, the Credit limit of the Invoice, when to discount an invoice etc,

The Procurement process when not carefully and timely reviewed, makes room for fraud. Constant review of the process, including the matching of invoices, and staff awareness of the same will eliminate any control weaknesses.

A consistent review of processes is a compulsory mandate as it helps to identify gaps, inconsistency and weaknesses that needs to be addressed in the short and long run.

As change is the only constant thing in the world, so continuous review of processes is mandatory to adapt to the changing circumstances. A consistent and continuous review helps to identify the gap that need to be addressed by the management to improve it's processes, methods and techniques to achieve the organizational goal.

Regular review of processes is a must. In a world of changing work environments, regular reviews ensure a smooth way of risk and loss minimization.

Realizar avaliações periódicas identifica pontos de melhoria, otimizando a correspondência e aprovação de faturas. Adapte procedimentos conforme necessário, com base em feedbacks e mudanças nas demandas organizacionais. Essa abordagem reflexiva promove uma operação mais ágil, transparente e alinhada com as metas corporativas, garantindo a contínua eficácia do processo.

To ensure efficient and effective control three way matching should be applied. From my experience the most efficient way to do so is to make each participant in the process do his work blindly from others work. The store receives the goods and writes receive report The quality checks the goods and then submits a quality report The invoice should be matched against purchase order,goods receipt report and quality report by the finance. No one in the cycle see what are the other elements of the process.

To ensure transparent invoice matching and approval in an organization, implement a clear and documented process. Utilize automated systems for matching invoices with purchase orders and receipts to ensure accuracy. Create a centralized platform for invoice submission and approval, allowing stakeholders to track the status of invoices. Implement segregation of duties to prevent fraud and errors. Provide training on the invoice approval process to relevant employees. Regularly review and audit the process to identify any discrepancies or bottlenecks. Lastly, maintain open communication with stakeholders to address any concerns and ensure transparency throughout the process.

As management accountants grapple with the critical question of ensuring transparent invoice matching and approval, a pivotal solution emerges in the form of e-Tax invoices and automation. Adopting e-Tax invoices, directly linked to tax administration agencies, enhances accuracy and compliance, while automation streamlines processes, allowing personnel to focus on strategic decision-making rather than mundane tasks. This approach not only fortifies transparency and efficiency but also significantly reduces operational costs, marking a strategic move towards smarter, more reliable financial management.

My view is that there should be coordination in the P2P process whilst maintaining rigid segregation of duty controls. Purchase Order created by Procurement and sent to supplier for delivery. Warehouse receives deliveries and update the accounting systems. Discrepancies are accounted for in the system for tracking purposes only. Debit and credit in and out. For quality items, upon receipt, a liability is created in the system and Goods Received Note generated. Finance receives invoice and match this to the GRN and also the PO (all in the system). Finance process and pays liabilities that are created from the GRN only. All unpaid amounts on the invoice should be investigated from the Warehouse. Communication is critical within the team.

to ensure transparency of invoice matching and approval, implement an automated invoice process which requires invoices to pass through the approval process in real time. Use a centralized software that tracks invoices, approvals and payment statuses for all stakeholders. Clearly define the workflow of approvals and provide audit trails: step by step accountability. Frequent updates on invoice status to relevant persons, promoting transparency and fast cleanup.