Below are the main requirements of any world-class automated accounts payable system:
Flexibility:
The payment system should provide flexibility to manage and streamline invoice and payment processing. Flexibility is required in the areas of account structure, multiple calendars, multiple currencies, multiple bank accounts, multiple payment terms, and how the system helps capture information by defaulting to linked information from basic data.
Accurate invoice processing:
The accounts payable system should provide controls and automations to improve the efficiency of invoice processing and simultaneously help ensure the accuracy of accounts payable information. Some automation features or best practices automatically associate an invoice with a PO by providing the PO number. Default accounting details and other information based on the corresponding purchase order.
Invoice approvals:
As a control and sox requirement, the payment system must support two-way, three-way, and four-way matching of purchase orders, invoices, receipts, and applicant acceptance documents. In addition, it should provide approval mechanisms to ensure segregation of duties.
Several types of payment:
The system must be able to handle all forms of payment, including manual payments, wire transfers, bank drafts, electronic funds transfers, and automated checks. In addition, these payments must be reconciled automatically or manually with the bank statements.
Supplier interface:
The system should enable rapid resolution of business issues by providing immediate and accurate responses to supplier inquiries. Ability to view invoice and payment status information together to make informed decisions and have a meaningful conversation with the supplier.
Further information:
Ability to save detailed vendor information including purchasing, payment and invoice processing preferences, flexible address format for global operations.
Electronic Data Interchange (EDI):
This allows supplier data to be exchanged with external parties such as banks and suppliers. The ability to use IDE greatly reduces many manual steps.
Payment at reception:
This is a finance function that automatically creates vendor invoices based on receipts and purchase order information. Advanced functionality will automatically create reconciled invoices, automatically approve invoices, and then make EDI or other electronic payments to the supplier.
Open interfaces:
Ability to transfer P2P data from other systems to the payment system.