What is Invoice Processing?
Invoice Processing Software uses OCR technology and page layout analysis to automatically identify the common data elements in an invoice, such as vendor, date, amount, invoice number, line item data, etc.. Invoice Processing applications are built using the same technology as data extraction applications, but have been specifically configured to recognize Invoices since they are one of the most common documents that companies need to automate.
Who can benefit from Invoice Processing software?
Any organization that receives a large number of vendor invoices on paper can benefit from invoice processing technology. The more data from each invoice that you are hand-keying into your accounting software the more benefit you can get from each page you automate.
Accounting firms and other companies that do outsourced accounts payable processing stand to gain the most return on investment from automation. It also has the benefit of on-shoring the data entry, providing additional security and piece of mind to your customers.
A robust OCR invoice processing solution becomes justifiable when you have over 1,000 invoices per month. When dealing with smaller volumes the potential return on investment does not justify investment in an enterprise solution. However, a simple document capture solution to digitize and store scanned invoices can still provide many benefits.
How much do Invoice Processing systems cost?
The total cost of a invoice processing solution includes several items:
- Cost of the software
- Time to install and configure the software
- Training the software to recognize your particular vendors and invoice formats
- Configure data export to your accounting solution
- User and administrator training
- Labor required to verify the recognition results
- IT infrastructure and maintenance costs
What is the typical data entry workflow?
The process of converting a paper invoice to live data in your accounting system is as follows:
- Paper is prepped for scanning (unfolded, staples removed, etc.)
- Invoices are scanned on a high-speed document scanner
- Scanned invoices are recognized with OCR
- Relevant data is located using keywords & other layout elements
- Questionable fields are displayed to a data entry operator for manual verification & correction
- In advanced systems, corrected fields are used to train the template automatically
so that data is captured correctly the next time
- Once all errors are corrected, data is exported directly to your accounting