Skip to Content

Supplier Invoicing-What SMEs Can Do to Reduce Workload and Errors

Many would agree that the accounts payable process is paper intensive and laborious. In most companies, particularly SMBs, supplier invoices are forwarded to the accounting staff from all over the company for payment. They key the invoice data into their accounting software and then it’s up to them to figure out if the goods or services have been received and the payment is authorized. Depending on how long it takes to verify the invoice, the company could end up paying the vendor late and missing a possible discount for early payment. While some invoices can be paid with a simple approval, some require more careful verification which often includes matching. Comparing a supplier invoice to the original PO to make sure the price being charged is correct and ensuring the quantity of physical goods being billed reconcile to what was actually ordered and received by the company can be very time consuming because a multitude of line items must be checked and errors reconciled before you can pay the supplier.

SAP Business ByDesign can help streamline accounts payable by automating the entire procure-to-pay process. It lets purchasers create a PO (or an employee can initiate the process via the employee self-services shopping cart), and send it to the supplier. When the goods or services are received, employees can verify receipt through the system’s workflow. When more precise matching is required, employees in the receiving department can pull up the PO in the system, verify the quantity received and create a goods receipt to notify the accounting department that the invoice is OK to pay. The accounting staff can access the orders or goods receipts in the Supplier Invoicing work center, invoice entry view. Discrepancies in the payment amount can be easily handled by either setting up variance thresholds (i.e. if the difference between the PO and the invoice amount is under 2%, the accountant can simply accept the variance and process the payment.). However, in the case of more significant variances, the accountant can use the system’s workflow to send a clarification request the purchaser. A clarification can be easily created from the menu in the invoicing screen. Once the accountant receives the authorizations she needs, she simply posts the invoice and schedules it for the next payment run. Another benefit of Business ByDesign is that all of the verification steps are displayed in the document flow and provide a full audit trail to comply with internal controls and keep the auditors happy.

Be the first to leave a comment
You must be Logged on to comment or reply to a post.