How to Get Invoices Approved Faster

Invoice approvals can be a thankless task for accounts payable (AP) staff.

Sure, invoices matching a purchase order (PO) can be posted and paid with minimal effort.

But the approval process for unmatched PO invoices or ones that need review is more complicated. Approvals for invoices from a strategic supplier, for a business unit, or high-dollar amount invoices are time-consuming.

AP staff must determine the purchaser, route the invoice for their review, and nudge purchasers who don’t approve invoices promptly. They also have to chase down any lost or misplaced invoices. A single delay in the approval process can create a bottleneck that can disrupt a company’s supply chain.

Slow invoice approvals are exacerbating the supply chain issues many companies are experiencing.

Consider companies with complex purchasing processes that generate a lot of invoices.

 

The problem with invoice approvals

Some AP departments rely on paper or email processes to route invoices for approval. Others use the workflow functionality built into their enterprise resource planning (ERP) applications. And some use legacy workflow platforms that do not provide up-to-date features and functionality. Many AP departments increased their use of email to route invoices internally and externally when their staff shifted to remote working.

All of these approaches to invoice approvals require a significant amount of manual intervention. Additionally, they create a lot of opportunities for errors, delays and potential risk of fraud and compliance issues.

 

The problem with invoices via email

Consider the shortcomings of using email to route invoices for approval. Emails often get buried in an ever-increasing amount of work and are hard to keep on top of. Email is not secure. Email doesn’t ensure chain of custody. Email cannot enforce separation of duties.

Emails can easily be misrouted and fall into the wrong hands. And they don’t provide AP staff with visibility into the status of the review. Email doesn’t log actions taken on an invoice, so there’s little accountability. And there’s no stopping someone from deleting an email ahead of a company’s retention schedule.

What’s more, emails don’t provide much efficiency in cases where multiple individuals such as office managers, line of business managers, and vice presidents of operations working in different geographic locations, need to review a single invoice. It might not be easy for everyone in the approval chain to access the supporting documentation they need to decide. An approver also may not be clear on who to send an invoice to next. Invoices can also easily become misrouted or lost.

All the while, AP staff can never be sure where invoice approvals stand in the process, meaning bottlenecks can go unchecked and suppliers can’t get an update on their invoice status.

It’s not uncommon for AP teams to waste a lot of time each month on back-and-forth phone calls and emails chasing down invoice approvals. Slow invoice approvals frequently result in late payment penalties and missed opportunities to capture early payment discounts. Then, more calls and emails from suppliers about invoice and payments status. Lastly, they cause difficulty forecasting cash flow.

 

How to automate invoice approvals

Cloud-based invoice-to-pay automated solutions accelerate invoice approvals.

Unmatched or non-PO invoices that require approval are digitally routed to individuals based on highly configurable business rules. Workflow rules can be configured based on an organization’s unique policies and procedures. There’s no chance of invoices going to the wrong individual, becoming lost, or falling into the hands of bad actors, and the company’s workflow rules are always enforced. Purchasers are notified of invoices awaiting approval and alerted when invoices approach their due date.

Supporting documentation can easily be attached so reviewers have everything they need in one place. If there is a delay in processing invoices, they are automatically escalated to a manager for review. Invoices also can be re-routed to another individual when an approver is out of the office. Throughout the process, AP staff have real-time visibility into the status of invoices, so they can resolve bottlenecks to ensure approvals stay on track and payments are on time.

Automatic logging of all actions taken on an invoice also improves accountability.

In today’s remote working environment, any business can benefit from workflow automation. But businesses with staff across offices, facilities or subsidiaries in numerous geographic regions can see significant improvements in the time it takes to approve invoices and pay suppliers. Workflow automation also helps businesses scale without the need for more AP headcount.

 

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Edenred Pay, an Edenred Company, is the global leader in invoice-to-pay automation. Our integrated platform connects businesses with suppliers, ERPs, banks, FinTechs, and payment rails to automate, optimize, and monetize the entire B2B payments lifecycle – from invoice receipt through payment reconciliation. Edenred Pay’s efficient, integrated solutions create a frictionless process and help deliver value to the enterprise by enhancing visibility and monetizing AP.

Visit www.edenredpay.com or contact us to learn more.