5 unnecessary invoicing mistakes that create extra work for Account Payable
Invoices can sometimes be an Account Payable (AP) clerk´s worst nightmare, especially if it takes hours and hours to manually process a single paper based invoice. Numerous things could go wrong with processing invoices manually; which can become very costly for business. Below we have listed five of the top invoice mistakes that businesses make.
1. Paper invoices
Many AP departments receive thousands of paper invoices per year, which will need to be manually keyed into a finance system.
This process is very slow, inefficient and costly. It is very easy to lose or misplace important paper documents when handling them manually, but with an automated invoice processing solution all documents can be stored electronically. The AP team will be able to retrieve invoices instantly, meaning no more time will be wasted searching for invoices in filing cabinets or folders.
2. No PO number
Invoices that arrive in AP without a PO number can be very problematic, which can take the team a lot of man-hours to manually process them. AP may receive non-PO invoices when a supplier has provided products or services to the buyer without receiving a purchase order. Many different challenges can arise when processing non-PO invoices which may include difficulty identifying the purchaser and original authorizer – making the approval process lengthy and a higher risk for errors.
3. Duplicate invoices
With so many invoices being sent to the AP department you are guaranteed to have a few duplicate invoices. Sometimes this could be someone trying to commit fraud, but sometimes this could be a genuine mistake. A few common mistakes that can cause duplicate payments include typographical errors such as;
– Confusing the number 5 with the letter S.
– Confusing the number 1 with the lower case L or I.
– Mis-keying or simply omitting punctuation.
– Adding a letter to the end of an invoice number to get past the system control which is flagging it is a duplicate.
These mistakes can lead to higher costs within the AP department and the company as a whole., but investing in an Invoice Management Solution could help to reduce the amount of time manually keying information into the finance system as well as significantly lowering the amount of duplicate invoices that don’t get noticed.
4. Missing or Incorrect Line Data
Incorrect or missing line data can include incorrect numbers or the wrong price on the invoice. This can cause a lot of problems for the AP team, as they would need to solve this discrepancy before the invoice gets paid. Correcting the problem on these invoices manually will be very time-consuming for AP staff, as they will need to find out where the mistake is and what the correct data should be.
5. Line items not adding up
When a line item, such as the VAT-number, doesn’t add up on the invoice the AP team will need to find the error and correct it manually to be able to process the invoice. This is very time consuming and can cause delays in paying the invoice. Investing in IMS can help to reduce the amount of time the discrepancy can take to rectify, by flagging invoices that have any mistakes and making sure the invoice isn’t processed until it has been corrected.
Investing in an Invoice Management Solution can help your business to avoid or eliminate the above invoice mistakes, as well as reducing data entry costs, errors and time solving discrepancies.
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