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On March 25 I created a post about streamlining the supplier invoicing process and discussed how this can be accomplised in SAP Business ByDesign. As a follow up, I thought I’d walk you through the Procure-to-Pay process (or at least most of it) in a step-by-step description of how this is accomplished in SAP Business ByDesign. Before I dive into the details, I want to say what is unique about Business ByDesign is its process-centric approach. All point accounting systems enable the accounting staff to enter supplier invoices-either through manual entry or electronic scanning. However creating the invoice in the system (and the AP journal entry in the GL) misses some important steps in the process–steps that should be properly documented for process integrity and internal control purposes. Supplier invoicing that starts with the accounting entry still leaves a lot of manual work for the accounting staff–mainly searching for POs, verifying invoices, and securing approvals.

Let’s walk through this in Business ByDesign. The process starts out with a requisition–either created by any employee from their Home workcenter–self services shopping view or other employees through a more formal requisition process. Built-in workflows automatically forward the request to the appropriate manager for approval and then on to the procurement people for request for quote creation and transmission to vendors. After a vendor is selected, the PO is issued. When goods are delivered, a workflow is sent to the original requester who confirms the correct goods or services have been received and a goods and services reciept is created in the system. Understand, that from the point the first requisition was created, this entire process is carried out and documented within ByDesign.

The accounting process–that is payment of the vendor invoice– starts in the accountant’s Supplier Invoicing Work Center/Invoice Entry view. The process is created from the work list of deliveries to be invoiced by highlighting the particular item and clicking on the “New Invoice” button. This brings up a new screen that’s already prepopulated with the vendor’s information and references to the purchase order. The accountant can further confirm what has taken place by checking the document flow–which provides a visual depiction of all the steps which have taken place to date. At this point, if there are discrepancies between the physical invoice and the data in Business ByDesign, the accountant can create a workflow–a clarification request and send it to the purchaser.  Assuming the purchaser OKs the discrepancy, the accountant can check the document flow or the exceptions or actions log to verify that all steps have been completed properly and that she has received authorization to pay the invloice.

For those who haven’t experienced AP processing first hand, you’ll notice that this automated process avoided a lot of manual checking, looking for original POs or checking them in a separate system or spreadsheet. We’ve also avoided having to chase down the purchaser by email or phone calls to get the “OK to pay” and of course, the real advantage is every step and who completed it is documented in Business ByDesign. This is just one example of how ByD’s process-centric approach can streamline accounting processes and ensure that proper internal controls have been followed.

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