Invoice processing: From adding invoices to exporting

Invoice processing: From adding invoices to exporting

From adding invoices to exporting

There are several ways to configure the Spend Cloud Invoice Processing module. Depending on your own invoice processing process, Spend Cloud integrates with it. The image below shows the process from adding to exporting an invoice, which essentially always follows the same steps.



When a product or service is purchased, the creditor (supplier) will send a purchase invoice. This article outlines how  the invoice processing process within the Spend Cloud aligns with this. The starting point is to strive for the ideal workflow, the so-called best practice method.

  1. Adding a purchase invoice
    1. Within the Spend Cloud, invoices can be added via two menu items: the ' Add ' menu and the ' Mailbox ' menu.
      1. Ideally, all invoices are sent directly from the creditor to the "Postbox" menu via email (with PDF and/or XML invoice attachments) or via the more modern PEPPOL network . For email forwarding, it's essential to configure forwarding from your own invoice email address correctly  (e.g., invoices@customername.nl ), so you can see within the Postbox who originally sent the email (e.g., sales@creditorname.nl ), and potentially bypass the Postbox for creditors who submit correctly . Additionally, we recommend not forwarding everything received by your own invoice email address; you could configure it so that only purchase invoices are sent to the Postbox. Any emails containing reminders, newsletters, or emails without attachments will then not be forwarded to the Postbox but instead forwarded to an alternative email address where you can review this flow. Manually forwarding from your own email address is more work and we do not recommend it.         
  2. Read a PDF purchase invoice via OCR (text recognition) or an XML purchase invoice
    1. Once the invoice has been added via the "Add" menu or via the "Postbox," the next step in the process is recognizing/reading the purchase invoice data as provided by the creditor.
      1. When you add a PDF file as a purchase invoice, text recognition ( OCR ) will be performed to recognize/read certain values. Using OCR, we attempt to recognize the following elements in the PDF : 
        1. Invoice date, Creditor based on IBAN (primary), Chamber of Commerce number (secondary) or VAT number (secondary), Payment reference/Invoice number, Total amount, VAT percentage, Currency, Order number, Contract number and/or Obligation number.
      2. When you add an XML file as a purchase invoice, an XML mapping will be used to read the fields provided in the code language. You are not dependent on text recognition, so the provided values ​​can be fully adopted/completed (provided the XML field formatting is compatible). To achieve a well-formatted display within Spend Cloud, it is recommended that the creditor provide the PDF version in addition to the XML version of the invoice. Working with XML purchase invoices is considered best practice.     
  3. Coding/booking a purchase invoice
    1. The most important step in the invoice processing process is the coding of the purchase invoice . Depending on how the PDF and/or XML invoice is supplied by the creditor, (many) fields may be pre-populated. This step determines which creditor the purchase invoice will be posted to and how the invoice should be accounted for in the accounting system. This includes determining which general ledger account and cost center should be used, and whether the costs relate to a different period. You could also split the invoice across multiple invoice lines for various reasons, such as if the costs need to be allocated across multiple general ledger accounts/cost centers. For the assessment process (procuration scheme) in Spend Cloud, the most important field is " Organizational Unit ," as this field determines who within the organization should assess (approve/reject) the costs for each invoice line.  
      1. There are several ways to ensure that the coding of a purchase invoice is done as automatically as possible . This can be done:  
        1. By using (where possible) a standard template , standard description , standard payment terms, standard VAT code (if VAT registration applies) and a standard general ledger account in the creditor settings .    
          1. Note:  The default payment terms, VAT code, and general ledger account are usually sourced from the financial system, and these default values ​​must be set there and transferred to the Spend Cloud.
        2. By using the coding matrix for the general ledger account (for example, by setting up a limited list of cost centers for a general ledger account with one cost center as the default for that general ledger account) or by using a standard workflow (for example, by setting a standard organizational unit and standard employee appraisal).    
        3. Via Smart Suggestions , which suggests the most likely values ​​based on previously booked invoices.
        4. By using purchase order matching or contractual obligations , a financial code is specified at an earlier stage and can be adopted immediately.   
      2. If you encounter any problems while coding a purchase invoice, you can use the "Request feedback" button at the top of the screen. You can then submit an internal (or external) question about the coding via email, and this will be saved as correspondence with the invoice. Depending on your setup, you can also offer an invoice line with the "To be coded" action , giving a (decentralized) employee the option to fill in or edit the invoice line fields themselves, or even distribute them across multiple invoice lines. 
  4. (Automatically) assessing a purchase invoice
    1. Once the invoice is fully coded, it must be "Sent" to the reviewer as specified in the invoice line item. Review by a (decentralized) employee is a simple action where you can choose between approving, rejecting, and putting it on hold (requesting an opinion). Depending on the setup, it's possible to forward an invoice line item to a group . To speed up invoice review time, we recommend reviewing via the Spend Cloud App as a best practice .    
      1. In an ideal workflow, invoice review is skipped by using a purchase order or purchase contract . In this case, the costs have already been reviewed beforehand, allowing the invoice to be automatically approved.   
      2. If the reviewer notices an error and the invoice wasn't submitted as "To Be Coded" and therefore doesn't have the rights to make an adjustment, the invoice can be rejected. The rejected invoice is returned to the central financial administration , can be corrected if necessary, and then resubmitted for review. 
        1. If, as a central financial administration, you accidentally submitted an invoice to the wrong employee for assessment, you can also reject it yourself . 
  5. Exporting a purchase invoice to the financial system
    1. Once the invoice has passed the assessment process (procuration scheme), the invoice (and the associated coding) is approved and can be forwarded (exported) to the financial system to enter the costs into the accounting system and meet the payment obligation to the creditor.  
      1. As an additional step in the process, depending on the chosen setup, there's  a "Check" menu  where invoices can be further reviewed after the assessment process before being exported. This can be done, for example, by a controller to ensure the coded invoice is correct and to reduce the need for subsequent corrections in the financial system.
      2. In the best practice, the central financial administration has the expertise to initially code the invoice completely and correctly, and the necessary checks are performed through the assessment process (procuration schedule). In that case, you could automate invoice exporting , which means that once an invoice is definitively approved, it is immediately transferred to the financial system (only possible with an automatic web service integration). To ensure that these automatically exported invoices end up in an unclosed period, you can administratively close a period in the Spend Cloud .  

Notes
Mastering the basic process? Watch the " Theme Webinar: Touchless Invoice Processing (So No Manual Interaction) " here and consult the PDF "Touchless Processing of the Top 50 Creditors" at the bottom of that article for step-by-step automation.

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