Once the invoice is received, how long does it take to get the invoice to the right place?
If you’re using an automated AP application, invoice receipt is quick and painless, automatically moving from one step to the next without much human intervention needed unless there’s an exception found.
However, if you’re manually processing your invoices, how quickly the invoice moves to the next step depends greatly on how it’s delivered.
Mailed invoices need to be routed to the correct individual, and if they’re emailed, they’ll need to be printed for processing.
Once an invoice has been received, it needs to be verified.
The best way to verify an invoice is by using the three-way match, which matches an invoice to a purchase order and delivery receipt.
If a purchase order was not used, you’ll have to verify its authenticity in another way.
Invoice Approval Preparation
Once an invoice has been authenticated and there are no exceptions found, the invoice will need to be approved.
If you’re using an automated purchase order system, approval may not be necessary, since the purchase order was approved.
However, invoices without a corresponding purchase order will need to be approved.
The approval process is what typically pushes the invoice cycle time up.
The manual approval process is ripe for bottlenecks, including invoices getting lost or misplaced during the routing process.
In theory, while an invoice should be quickly approved, the reality is that an invoice, routed manually, can often remain on an approver’s desk for days or even weeks.
And for invoices that need a second approval, such as those over a certain dollar amount, approval time can quickly rise.
Once an invoice is routed back to AP after approval, it will need to be entered into your accounting software application, where it is scheduled for payment.
If you’re using a manual AP system, the invoice will need to be entered into your accounting application.
Data entry is not necessary with an automated AP system, which will integrate with your accounting software or ERP and process the invoice ready for payment immediately upon approval.