Invoice Management is an internal business function responsible for managing documents from vendors or suppliers. Invoices represent a source document in accounting. Source documents outline of the specific information relating to a financial transaction. Suppliers usually offer external services such as maintenance, utilities, office supplies, or advertising for businesses. Suppliers representing companies that provide businesses with economic means. Economic resources are the raw materials and direct labor needed to produce goods or services to consumers. Companies use invoice management processes to ensure suppliers and vendors receive payment in a timely manner.
A common invoice management process is the three-way matching system found in the accounts payable functions. Purchase orders represent the companyâ € ™ s internal information that individuals provides specific authorization to purchase items from vendors or suppliers. Two copies of purchase orders in the majority of a company. It is sent to the seller or supplier and one is retained in the companyâ € ™ s accounting department. This document comes into play later in the invoice management process.
Companies with business technology software can use electronic copies of purchase orders. Instead of maintaining a file allows companies to scan this information in a server database, a paper copy. This makes it possible individuals to revise, if necessary, or to pick up the order. Business software can also increase the accuracy of the purchase order information.
The second document in the three-way match invoice management system, the receiving ticket. The receiving ticket and displays were all the goods and services received by the company in accordance with the order. Receiving tickets are usually the responsibility of the companyâ € ™ s warehouse or administrative staff. A copy of the order and receive the ticket for accounting finalize sent to invoice payment.
Many vendors and suppliers give customers 30 days to pay before the adoption of rights and interest on unpaid balances. Accounts payable clerks will host ticket and purchase order file in an excellent file. Upon receiving the final invoice requesting payment vendorâ € ™ s debt clerk will agree to insure the information matches with all three documents. Matching each Documenta € ™ s information is the core of the three-way invoice management system. Companies seldom pay vendors or suppliers if the documents do not match. Once the accounts payable process is completed, clerks will cut a check for the bill, asking signature of the owner or manager right, and mail the check.
Businesses can use custom invoice management systems. Entrepreneurs and managers will have a system that best supports developing their back-office and accounting functions. Larger organizations receive hundreds of invoices per month may require a simpler system than the three-way match. Invoice management, not all businesses need to use the same system.
- Companies use invoice management processes to ensure suppliers and vendors receive payment in a timely manner.