Automation is playing an increasingly important role in this regard, with AI-driven Accounts Payable automation solutions capable of handling many of the menial tasks, thus streamlining the AP process, generating cost savings and enabling business growth without having to expand your workforce. This article will cover all you need to know when it comes to mastering the Accounts Payable process and reaping the benefits of a lean and efficient AP system.
Key steps in the Accounts Payable workflow
In order to master the Accounts Payable process, it is vital that all stakeholders within your company are familiar with each of the steps involved and their own responsibilities within your new organisational structure. We will now take a detailed look at each of these key steps and their importance to the efficient and compliant running of your business.
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➡️ Step 1: Purchase requisition
A formal request is raised within the company for the purchase of goods or services. This process generally includes a detailed submission of the desired purchase, the granting of relevant approvals and the routing of information to the relevant accounting staff for consideration when budgeting.
➡️ Step 2: Purchase order issuance
Issuing purchase orders is essential to ensure that spending is authorised and fully traceable from order to payment. Purchase orders must then be aligned with received goods and outgoing payments, defining clear payment terms and enabling the efficient reconciliation of invoices.
➡️ Step 3: Invoice receipt and data capture
Accounts Payable automation solutions facilitate multi-channel data capture, whereby invoices received in a wide range of formats (such as paper documents, emails, EDI/STFP, Word or PDF files, etc.) are scanned and stored in a centralised repository. Relevant data such as the name of the supplier, the supplier’s VAT number, the VAT amount, or the total invoice amount can be extracted by means of OCR or Smart Data Extraction. Automating this process reduces the risk of lost information, ensuring that information is correctly allocated and recorded for subsequent access.
The importance of accurate data entry
The correct inputting of data right from the outset is essential to avoiding costly errors later in the process. Clear, transparent and accessible data recording avoids missed payments (thus improving supplier relationships) and facilitates financial planning by providing enhanced visibility over payables.
➡️ Step 4: Invoice GL coding
General Ledger (GL) coding is a crucial step in the Accounts Payable process. It involves assigning the correct GL accounts and analytical dimensions (such as cost centres or projects) to each invoice, ensuring transactions are accurately recorded in the general ledgers. Automating GL coding helps streamline invoice processing and reduce errors, while also accelerating the production of accurate, reliable financial statements.
➡️ Step 5: Invoice matching & verification
The alignment of purchase orders (PO), invoices and goods received notices (GRN) is vital in ensuring that purchases have been authorised prior to payment processing. This is one area of Accounts Payable where automation solutions really come into their own, offering a number of time and cost-saving features such as:
- Automation of 2-way and 3-way matching: Purchase orders are compared against invoices and/or goods received prior to the approval of payment. This helps to avoid errors such as overpayment and provides an effective safeguard against fraud.
- Checking for duplicates and errors: Document comparison enables the rapid identification of anomalies, duplicate orders/payments and errors. This safeguards supplier relationships by ensuring correct and prompt payment and closes potential loopholes for employee fraud.
➡️ Step 6: Invoice approval
This vital step in the Accounts Payable process has in the past represented a source of employee frustration and wasted resources. Without automation, approvers often waste time tracking down missing invoices, verifying outdated or incomplete information, checking budget availability, or ensuring the right stakeholders have signed off, all of which may involve back-and-forth communications. Thankfully, automation solutions offer a means by which to streamline and improve the approval process by recording all relevant information in one centralised and accessible location. AP automation offers a number of different features that can simplify and accelerate the invoice approval process, such as:
- The ability to apply pre-defined rules to the approval workflow (e.g. automatically routing to a director in case of transactions over a certain value)
- Setting up 2-eye / 4-eye checks depending on the transaction amount, the supplier, the region etc.
- The possibility to approve invoices from your smartphone when you are out of the office, or assign delegates to grant approvals on your behalf
“It is no wonder why accounts payable departments have made automation their top budget priority. But achieving the benefits of automation will remain out of reach for accounts payable departments that don’t take the right approach to selecting and implementing a solution.”
Mark Brousseau in the article “Seven Ways to Make the Most of Your Accounts Payable Budget”
➡️ Step 7: Payment scheduling and execution
This step starts with the generation of a payment file, which can then be sent to the bank or integrated into your existing ERP system. This simplifies and accelerates the execution of payments. Efficient organisation in this regard plays a significant role in cultivating healthy supplier relationships, which will enhance your ability to negotiate improved terms for subsequent orders.
➡️ Step 8: Reporting
As already alluded to, financial reporting is essential for effective cashflow visualisation and budgeting. Automated Accounts Payable solutions provide real-time access to financial information. Aside from enabling swift action in the event that issues or anomalies are identified, the ability to access up-to-date, searchable data from any location greatly improves the financial reporting process and accelerates auditing.
➡️ Step 9: Archiving and audit trail
The archiving of order, invoice and payment data in a secure centralised location guarantees regulatory compliance, facilitates access to information for reporting and auditing purposes and safeguards against lost data. Cloud-based AP automation solutions with archiving capabilities offer the further advantage of making information available to multiple users in multiple locations (provided they have been assigned the required user access), with real-time updates and with reliable storage that can grow alongside a scaling company.
➡️ Step 10: ERP integration
AP automation can integrate seamlessly with existing accounting software/ERP solutions. Information is automatically shared between the systems, helping to prevent data silos, reducing manual intervention, and providing a single source of truth.

Challenges and solutions in managing Accounts Payable
Manual invoice and payment processing can represent a major source of errors and unnecessary expense. For example, managing Accounts Payable tasks manually can typically result in a lengthy invoice to payment approval process. Not only this, but data entry errors can result in unapproved spending, lost documents or information, an inability to scale processes in line with corporate growth, failure to comply with data storage and access legislation, and in the worst-case scenario, financial fraud.
What’s more, companies often experience difficulties integrating Accounts Payable systems with Enterprise Resource Planning (ERP) systems. This can be due to data compatibility issues, system compatibility and resistance to change among employees. Poor data quality is perhaps the main contributor with regard to integration problems.
Accounts Payable automation solutions are an effective way to overcome many of these problems. Through the extraction and storage of information in a standardised format, solutions such as Yooz can be seamlessly integrated with a wide range of existing ERP solutions, serving an extension of the system rather than a separate and additional tool.
The benefits of a streamlined Accounts Payable process
Optimising and automating AP processes offers a number of tangible benefits that can transform and streamline daily business operations…
- Cost reduction and efficiency: Streamlining your AP processes by assigning repetitive and laborious tasks to an AI-driven automation solution means that skilled employees can instead focus on strategic tasks that bring real added value to the business. This will in turn result in business growth without the need to recruit new employees and expand the workforce.
- Closing books on time: Automating routine tasks, such as invoice matching and approval routing significantly reduces time traditionally spent on manual processes. This acceleration of month and year-end processes allows financial teams to close the books faster, with less effort and improved accuracy.
- Reducing fraud and costly errors: The use of AI to highlight duplicates, anomalies and overpayment can help to eradicate mistakes resulting from human error or intentional fraudulent activity.
- Gaining control over spending and approvals: Optimising cash flow visualisation, with transparent data that is updated in real time gives decision-makers a reliable overview of the company’s financial situation. They can therefore allocate funds more strategically and identify both areas for investment and areas where expenditure needs to be reined in.
- Improved supplier relations: Avoiding late payments and the need to recover incorrect or duplicate payments fosters confidence among suppliers. Well-managed long-term supplier relationships offer stability and the opportunity to negotiate improved terms.
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Leveraging technology in Accounts Payable
It has become clear that the leveraging of technology is essential if companies are to avoid the pitfalls highlighted above. Let’s now take a detailed look at some of the advanced technologies that are integrated into modern Accounts Payable solutions such as Yooz.
OCR technology in Accounts Payable
OCR technology has been in use for many years as a means by which to scan invoices (paper or digital) and extract key information such as the supplier name, invoice number, date and totals. By harnessing Big Data from 1 million suppliers and 200 million documents, Yooz’s integrated AI algorithm can learn how to recognise and extract relevant data from an invoice, thus eradicating reliance on rigid templates and the manual tagging of various invoice elements. We refer to this process as ‘Smart Data Extraction’.
Machine Learning and Deep Learning in AP automation
Machine Learning (ML) algorithms learn from every invoice processed, recognising patterns across suppliers and formats. A subdivision of ML known as Deep Learning utilises neural networks to gain an understanding of complex relationships between data fields, thus improving how the system maps and interprets the extracted data, even when layouts vary.
Utilising Big Data to boost accuracy
Modern AP automation platforms increasingly rely on Big Data to drive smarter, faster invoice processing. By leveraging large volumes of invoice data, these systems can recognise diverse invoice formats, detect anomalies and adapt to supplier behaviours with minimal manual input. Yooz, for example, draws on a dataset of over 200 million invoices and more than 1 million supplier profiles to power its Smart Data Extraction. This rich data foundation enables high levels of accuracy and efficiency from day one, without the need to manually train the system, accelerating time to value for finance teams.
Automated AP workflows: How Business Process Management (BPM) powers invoice approval
Automated AP workflows are driven by Business Process Management (BPM) engines. These engines define and execute dynamic workflows that route invoices and documents based on predefined rules, such as invoice value, department, cost centre, or supplier. Yooz utilised BPMN2 (Business Process Model and Notation 2.0) as a standard visual modelling language to present workflows in a manner that makes it easier for both technical and business users to understand, analyse and improve processes. Once an invoice enters the system, BPMN2 ensures that it follows the correct approval path, notifies the appropriate approvers via email or mobile app, and logs every step for a seamless audit trail.
Real-time reporting for strategic visibility
Real-time AP reporting gives finance leaders instant visibility into invoice status, approval workflows, cash flow and supplier spend, all from a single centralised platform. Reports can be customised to meet internal needs or exported to support audits and regulatory compliance. YoozReports enables effortless data export to Excel, allowing teams to build custom reports with real-time updates. Seamless integration with leading BI tools ensures further insights and strategic visibility.
While advanced technologies have the potential to significantly transform Accounts Payable, it’s essential to recognise that not all automation solutions are equal. To drive real impact, finance leaders should evaluate platforms based on the sophistication of their technology, scalability, user experience and seamless integration with existing financial systems. A well-informed choice will ensure lasting value and position the AP function as a strategic asset within the organisation.
Conclusion
The multiple steps involved in the Accounts Payable process may appear daunting, especially when confronted with the decision to upgrade a long-standing system in the face of potential employee resistance and associated financial outlay. However, rather than further complicating matters, modern automated Accounts Payable solutions such as Yooz can significantly streamline your accounting processes, accelerating the invoice to payment journey, eliminating human error and automating routine and tedious data processing tasks. Furthermore, automated data extraction, archiving and reporting simplify the audit process and help to ensure compliance with data processing regulations.
If you are interested in investing in the automation of your Accounts Payable processes and would like further information on how an automated solution can integrate with the systems already in place within your company, the competent experts at Yooz would be more than happy to assist with a personalised consultation.
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