In recent weeks getting paid quickly has become the name of the game – when credit is tight fast cash-flow counts. But all too often invoices can be delayed or set-aside by accounts payable departments due to inconsistencies that arise between an invoice and its relating purchase order.
Matching an invoice to a purchase order and checking against goods actually received creates a tricky three-way matching and approval process that can all too frequently result in a delay in payment due to inconsistencies, errors and poor communications. Accuracy is essential to getting paid quickly.
But, if invoices were to be pre-checked against purchase orders and delivery notes prior to sending to the customer potential problems and mismatches could be identified and addressed in advance, reducing hold-ups in payment and speeding cash-flow.
It may be that, say, 100 items were ordered by a buyer but under their terms and conditions it was acceptable for the supplier to ship up to a maximum of 110. However, the invoice might fail if there were a discrepancy between the purchase order and shipping notice. According to Anthony Payne at Wesupply, action in advance could allow for the invoice to be adapted accordingly or for a buyer to be notified.
“If one line item in an invoice containing, say, 80 line items fails the whole invoice may well be halted. Under these circumstances an alert would enable a supplier to pull out that one item and generate an invoice for 79 items instead, so ensuring fast payment of the majority of the order,” says Payne.
Pre-invoice matching can now be facilitated using intelligent electronic trading technology that is able to look at the data carried inside the message. So spotting errors or mismatches in invoicing can become an automated process that brings direct cash benefits. Now that should put a smile on the finance director’s face.
