The term “invoice scanning” refers to digitizing supplier invoices using Optical Character Recognition (OCR). OCR is a technology that enables software to read machine-printed text from scanned images.
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Scanning invoices: The essential first step to accounts payable automation
Automated accounts payable is no longer the future, it is very much the present.
Technology has advanced to a point where machines can handle accounts payable better than your human finance team can.
At the core of automated accounts payable is invoice scanning. This technology has been perfected with the help of machine learning and accurate data capture. It can bring your business a wealth of benefits, but what’s more, failing to keep up with these technological trends is leaving your business exposed to risk.
Here’s what you need to know about the problems with manual invoice processing, and the ways that invoice scanning combats those threats.
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Why Scanning Invoices Is Critical for Accounts Payable Automation
Time-intensive manual data entry
Manual data entry takes time – time that could be spent more productively on other tasks. Invoice scanning tech will aid you here. With more time on their hands, your finance department can focus more on financial reporting or keeping your bottom line in order.
They are also saved the laborious, mind-numbing work of filing invoices, making their role more fulfilling.
Increased risk of lost or misfiled documents
As we just said – and anyone who’s spent time doing it knows – hours of repetitive invoice filing numbs the mind. Spend too long at it and you’re making yourself error-prone.
Debby from accounts might misfile an invoice, or do-it-next-week Dave could lose one under a stack of papers he never moves – putting your company at risk. Those risks can range from damaged vendor relationships with unpaid suppliers, duplicate payments, time lost fixing the problem and more.
Perhaps worst of all are security threats and the risk of failing business audits – financial compliance is known to be built on strong audit trails.
And let’s be fair you don’t have to be do-it-next-week Dave to make an error filing invoices – it can happen to the best of us.
Delayed processing times impacting supplier relationships
Your suppliers want to get paid, and they want to get paid on time. If you’re manually processing invoices, you’re creating unnecessary risk of delaying those payments. We don’t need to drive home the point about how poor supplier relations can impact your business. If you don’t pay on time, your supplies won’t arrive on time. Simple as that.
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The technology behind scanning invoices
Here’s a bit of an explainer on the tech that’s made invoice scanning a key part of automated accounts payable.
Optical character recognition (OCR)
Optical Character Recognition (OCR) is a technology that scans the text and figures on your invoices and turns it into machine-readable data. It’s the cornerstone of automated invoice processing.
Improvements in OCR over the past two decades are what has made digital invoice processing the gold standard for finance departments.
OCR will lift invoice numbers, prices, suppliers, dates, and a whole lot more from an invoice. Once it’s captured that information it will export it to your invoice processing system.
Intelligent document processing (IDP)
Intelligent Document Processing (IDP) is a cutting-edge technology that uses AI to extract information from documents – in this case, invoices.
IDP differs from OCR in that it uses machine learning. This is done through AI and technology known as robotic process automation (RPA). RPA uses software robots – usually just known as ‘bots’ – to handle repetitive work. See where we’re going with this?
That repetitive work? That’s processing your invoices. IDP will do it faster and much more accurately than a human ever could.
How does it work?
Simple. OCR reads the document and IDP figures out what to do with the information the way Debby knows which of your paper-stuffed filing cabinets to put an invoice in. It then files that invoice into your databanks correctly and efficiently.
How Zahara simplifies scanning invoices and AP automation
Zahara’s invoice processing software integrates with all the major business software and makes the most of OCR and IDP. Here’s what it does for you.
Seamless integration of scanned invoices
From Sage, Xero and MYOB, to QuickBooks and Business Central, Zahara integrates with, and enhances, your business software. It’ll fill in the gaps in automated invoice processing that these systems don’t provide without added extras.
When you process an invoice through Zahara, our software uses OCR and IDP to read and dissect your invoice. It will hold a magnifying glass up to every detail in a way the tired eyes of a human couldn’t.
Once your invoice is read, it will integrate the information with whatever software you run your business from. You don’t have to do much more than feed your invoice into Zahara. It only takes a few clicks of the mouse, the software will do the rest for you, and it’ll do it in seconds
Three-way matching
Three-way matching is one of the most important functions of automated invoice processing. This is where your invoice processing software checks the details of an invoice (supplier info, prices, invoice numbers etc.) against corresponding purchase orders and goods received notes. This ensures that everything is in order before payments are sent.
If anything doesn’t look right, Zahara will flag it for you.
Key benefits of using Zahara
Enhanced audit trails
Every invoice you process with Zahara is recorded from receipt to approval. You’ll be able to see who’s handled what, amounts, dates of payments, and more. The result being a robust system for looking back into your financial history.
Strong fraud detection and elimination of duplicate payments
Three-way matching will spot fraudulent invoices, picking up on the tiny discrepancies fraudsters use to deceive finance teams. The same technology will pick up on any duplicate invoices and payments to ensure you don’t accidentally end up paying twice.
Speedy approval workflows
Zahara adds simple, smooth approval workflows to your business software. Once an invoice has been processed it will be passed on to a department head for approval. Only people with proper authorisation can approve payments, giving you better control over how your business spends money.
Smoother accounts payable
Zahara will save you time. Processing invoices will no longer require that manic rush to meet month-end deadlines. Instead, all that painstaking work can now be done in seconds. No rushing to get your invoices done before the end of the month means Zahara will also save you a lot of stress.
Your finance staff will now have a more rewarding job and can make better use of their time focussing on the things machines can’t do: trimming the fat from your business, keeping your bottom line low, cultivating better relationships with suppliers.
Start scanning invoices and automating your accounts payable today
This is the age of accounts payable automation. The technology has never been better – the benefits never more rewarding. If you want to keep your business in lockstep with the way industry leaders are heading, win the edge on your competition or regain the controls you lost when your business expanded, automated invoice processing will do it for you.
Not only that, but it will do it faster and more accurately than a human ever could.
We know that we’ve got a horse in this race, but we really think Zahara is the best option out there. We’ve taken years to develop our software, listening to feedback from our users along the way to make sure that our software does exactly what you want it to. You can read what our happy customers have to say about it here.
