ERP Accounting Software: Leveraging Paperless AP Functionality

Many ERP accounting software packages on the market today feature paperless accounts payable functionality (paperless AP). Paperless AP allows the organization’s accounts payable department to operate in a completely paperless environment, ridding the organization’s back office of excessive filing cabinets and mounds of paper invoices to be entered into their ERP system manually for processing. Should an organization wish to adopt paperless AP, it needs only three things: 1) an ERP system with integrated paperless AP functionality; 2) sufficient electronic storage space on the company’s computer; and 3) a document scanner.

For organizations using paperless AP functionality, a typical process flow would be as follows:

1) The accounts payable department receives an invoice from a given vendor or supplier, the invoice is scanned using the document scanner, an image of the invoice (usually a PDF) is generated and stored on the organization’s computer, and the associated purchase order document numbers are recorded.

2) The ERP system then automatically assigns a document number, creates an open AP matching record, and chooses the lowest value of the invoiced/received amounts to pay

3) AP personnel would then review the batch entries, view the invoices online as needed, make any necessary corrections to the batch entries, flag the purchase order(s) as complete where applicable, and commit the batch to be processed.

Simple, right? Organizations who leverage their ERP’s paperless AP functionality can not only streamline the flow of information through the accounting department, they can improve visibility to vendor invoices through electronic storage and reduce employee man hours spent processing invoices. Furthermore, should one of the organization’s vendors inquire about an invoice, the AP department would have the ability to retrieve the invoice quickly and easily without having to sort through potentially hundreds or thousands of paper invoices in a filing cabinet hoping that no one else has pulled that same invoice from the file.

In addition, this form of electronic document management is frequently found throughout the ERP system for other departments within the organization, not just the AP department. Sales reps, for example, can have the ability to scan contracts or purchase agreements and attach them to a customer record; purchasing managers can store product specification sheets from suppliers; and quality control personnel can store Certificates of Analysis (COA’s) that accompanied products, materials, components, or ingredients that were received into inventory. The opportunities to deploy electronic document management throughout the organization while still accessing information contained in the organization’s ERP system are nearly limitless.

Given the relatively low cost of additional electronic storage space and the development of new, high-tech document scanners, organizations who adopt paperless AP processes can save time and money with minimal upfront cost.