Processing Non-PO Vouchers

Processing Non-PO Vouchers

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Their role is to complete payments and control expenses by receiving payments, plus processing, verifying and reconciling invoices. A typical Accounts Payable job description also highlights the day-to-day management of all payment cycle activities in a timely and efficient manner.

A slow approval process can have a significant payment turnaround times and revenue. Paper invoices can sit on a busy employee’s desk or get misplaced as it is moved around from desk to desk. By using an automated invoice processing system, an AP department can save time tracking down lost documents or requesting invoice copies from the vendor.

Three-way matching

In an automatic process, once the data is extracted or captured from the invoice the data is sent into the system for automatic matching against the purchase order. This matching process can compare just the invoice data with that shown on the purchase order or be expanded to include a deeper level that looks at the receiving documents. Workflow steps can be configured such that the responsible person will then receive an email alert so that he or she can approve the invoice.

Way Matching Process

Intelligent invoice matching of PO invoices can, in fact, support a fully automated and touchless process. Today, an increasing number of business owners and departments in charge of finances are using three way match processing to mitigate risk and reign in company spending. To counter the threat of overpaying for goods and services or paying a counterfeit invoice, you should incorporate automated three way matching into your accounts payable processes.

In the accounting and bookkeeping area of accounts payable, the three-way match refers to a procedure used when processing an invoice received from a vendor or supplier. The purpose of the three-way match is to avoid paying an incorrect and perhaps fraudulent invoice. Every business can benefit from speeding up payments and reducing the threat of human error. By leveraging 3 way matching accounting departments can streamline payment processes, mitigate the risk of human error, and exchange business documents digitally.

3 way match

Savvy finance departments know that there is a plethora of vulnerabilities that come with manual invoice matching and processing. From lost invoices to late payments and less-than-stellar payables visibility, manual invoice matching can put any finance department in jeopardy. In general, both types of invoices are processed by a company’s accounts payable department. The process in which a supplier invoice is validated and paid is also known as the purchase-to-pay cycle. Automated invoice matching and processing (also called AP automation) is usually priced based on invoice volume rather than the number of users, so the cost can be quite economical, even in very large organizations.

Traditionally, an accountant in the accounts receivable department would have to gather all the relevant paper documents in a transaction in order to satisfy their matching procedures. Over time, documents can get lost or stolen, or figures can be miscommunicated and lead to costly mistakes that can delay business processes. When trying to scale for growth, manual accounts payable processes can be a major deterrent.

What is 3 way matching principle in accounts payable?

Thus, the “three-way match” concept refers to matching three documents – the invoice, the purchase order, and the receiving report – to ensure that a payment should be made. The procedure is used to ensure that only authorized purchases are reimbursed, thereby preventing losses due to fraud and carelessness.

  • Today, an increasing number of business owners and departments in charge of finances are using three way match processing to mitigate risk and reign in company spending.
  • To counter the threat of overpaying for goods and services or paying a counterfeit invoice, you should incorporate automated three way matching into your accounts payable processes.
  • Intelligent invoice matching of PO invoices can, in fact, support a fully automated and touchless process.

What is Matching?

The benefits of an automatic processing workflow may include reduced human error, on-demand reports, and data resilience. Most automation software today integrates into common organizational ERP systems such as SAP, Microsoft, and Oracle. The role of the Accounts Payable involves providing financial, administrative and clerical support to the organisation.

By migrating to automated matching processes, you can streamline your accounts payable procedures and handle a nearly endless supply of invoices, POs, and order receipts without missing a step. The three-way matching process happens automatically when you upgrade to an e-procurement system like PurchaseControl – no human intervention required. Issues are brought to light early, so you don’t bottleneck or slow down the payment process. You will significantly reduce processing costs, and perhaps more importantly, be able to spend more time doing more valuable work. Ensures optimal vendor relationships – Professional vendors respect the importance of purchase orders, invoices, and receipts to the accounts payable process.

Frequent mistakes on receipts and invoices can be a sign of a broader business issue, and may indicate that it’s time to begin shopping around. A PO invoice is, in fact, a pre-approved invoice since the purchase, supplier and amount was approved as part of the purchase requisition process leading up to the purchase order.

If there are other people involved in the approval workflow, email alerts to them will also be automatically generated. Identification of the vendor and business unit associated with the invoice, 3. Technology has long enabled the automation of invoice processing from arrival to post. This means that at arrival of the invoice, the same accounts payable clerk will only need to scan the invoice into an automation software. The automation software then converts the invoice’s scanned image into a text-researchable document.

Manually entering this data can take a lot of staff time and carries the risk of human error, which can be detrimental to a company’s financial records. Using an automated system can reduce invoice-processing costs by 75% to 85% while decreasing errors at the same time. Having the tools you need to track this data also improves access to invoice data, which improves the service to vendors and results in the faster turnaround on payments.

Accounts payable job descriptions are also often labeled as “full cycle.” This means the accounts payable employee is responsible for every part of the payment process, as opposed to specializing in one or more specific areas. Potential responsibilities might include three-way matching, reviewing expense reports for accuracy, applying payment discounts and issuing payments to vendors. Upon migration, automated invoice management processes will no longer suffer from the long delays, bottlenecks, and processing costs that plague manual matching.

This way, a PO invoice can be automatically processed for payment as long as all details match the information on the purchase order and goods receipt, without anyone manually reviewing and approving the invoice. If a deviation is identified in the matching process, the invoice will be sent to the buyer for review and action.

Three-way matching is a procedure for processing a vendor invoice to ensure that a payment is complete and accurate. After an AP department verifies invoice information, it needs to submit the invoice for approval before they can send a payment.