- What Is an Outstanding Invoice?
- What Is an Invoice?
- What Is a Tax Invoice?
- What Is a Shipping Invoice?
- What Is a Proforma Invoice? Must-Know about Invoicing
- What Does Net 30 Mean on an Invoice?
- What Does FOB Mean on an Invoice?
- What Are the Different Types of Invoices?
- VAT Invoice Template: Get Your Free Sample Now!
- Sales Invoice: A Complete Sales Invoicing Guide
- Purchase Order vs Invoice
- P.O. Number: What It Is & How It Works?
- Is an Invoice the Same as a Bill?
- Invoicing Basics: What Is Invoice Number?
- How to Write an Invoice?
- How to Write an Invoice for Services Rendered?
- How to Write a Winning Invoice Letter?
- How to Recover a Past Due Invoice Professionally?
- How to Print an Invoice?
- How to Make Invoices in OpenOffice?
- How to Make Invoice Number Change Automatically in Excel?
- How to Make an Invoice on Excel
- How to Make an Invoice in Word
- How to Make an Invoice in Google Docs?
- How to Make an Invoice?
- How to Make a Simple Invoice?
- How to Make a Service Invoice?
- How to Invoice as a Contractor: A Step-By-Step Guide
- How to Invoice a Company: A Step-By-Step Guide
- How to Design Invoice?
- How to Charge Late Payment Fees?
- Flat Rate vs. Hourly Rate
- Are Invoices Payment Receipts?
- A Stepwise Guide to Process an Invoice
A Stepwise Guide to Process an Invoice
Receiving invoices is not a big deal, but processing them is. Processing an invoice requires you to follow a specific procedure essential for maintaining accurate financial records.
Below, we’ll cover:
- What Is Invoice Processing?
- What Is Invoice Processing Used For?
- Invoice Processing Workflow
- How Do You Process an Invoice for Payment?
What Is Invoice Processing?
Invoice processing is a procedure that starts after receiving invoices. The procedure is followed to ensure every invoice is thoroughly looked upon and the right payments are processed.
An invoice goes through a series of steps before it’s made valid for processing payment. This all is managed by a business account payable department. An invoice processing includes checking the invoices received, matching the invoice content with purchase orders, tracking, approving, and finally making the payment.
What Is Invoice Processing Used For?
Invoice processing is used for keeping and maintaining the records of all invoices received. It also takes the request for payment further.
Through invoice processing, the employees receive the payment for their work on time, and the suppliers get money for their supplies.
Invoice Processing Workflow
The whole process of invoice processing involves a series of steps. It can be automated and made easy with the help of an invoice processing workflow. Invoice processing workflow is a software that makes handling invoice processing easy with the automated process.
The invoice processing workflow works with scanning the invoice content like invoice number, name, address, amount, date of invoice, name of the vendor, and other essential details. This data is stored in a digital format to be later matched with the purchase order details.
The purchase order details are stored in the ERP database. The further information generated after matching the invoices with purchase order data is stored in the ERP system again.
Depending on how well the invoice is matched with the purchase order, the invoice is then declined or approved. If the invoice is approved, the payment is further initiated.
How Do You Process an Invoice for Payment?
For an invoice to be approved for payment, it goes through a three-fold step. Here is the process followed:
Verification and tracking
When an invoice comes in, the purchasing company has to verify the invoice contents with their own records to ensure the correct payment is being processed. For this, the invoice should also be made such that it includes all necessary. It should include:
- Date of the invoice
- Contact information of both vendor and purchaser
- Details of purchase like prices and quantities purchased
- Payment information
- Data entry and ledger recording
Once the data is matched perfectly with the purchasing company orders, the data is entered into their records manually or through an automated system.
Forwarding for approval
Once the data is matched and recorded in the books of the purchasing company, the invoice is sent for approval.
This is when most invoices are delayed and misplaced.
Once the invoice is approved, the payment is made.
How long does it take to process an invoice?
Depending on the company's size and invoice approval policies, it can take up to 25 days to process a single invoice with a manual invoice processing system.
How to enter an invoice?
Filling invoices is easy when you are using invoice templates that include filling in necessary information like vendor name, payment due date, discount rate, etc.
WeInvoice has many templates for different types of invoices along with a fantastic set of invoice generators. Check out now.