QuickBooks AP automation process works great when only creating a few supplier invoices (Bills in QuickBooks). But as the volume increases, the AP team struggles with keeping up with the increased volume. More time spent processing invoices means delayed close of month close process.
In our experience, companies using QuickBooks face the following challenges with the Accounts payable process:
Matching invoices with purchase orders
Many companies don’t have the discipline to create purchase orders in QuickBooks, so they use a manual purchase order process. The purchase orders get created outside of QuickBooks, and the buyers keep track of purchases in a spreadsheet.
The AP team then has to find a matching purchase order for each invoice and follow up with stakeholders to match the invoice with the purchase order. This is time-consuming and leads to delays in closing the books.
Manual invoice approval
Manual invoice approvals are the second biggest challenge.
An invoice will need a review if there is no matching purchase order or an issue with the invoice.
For example, the purchase order amount is $100, and the invoice amount is $150. This issue is a result of pricing or quantity mismatch.
The AP team can’t decide whether to pay the invoice, so the AP team sends the invoice to the respective stakeholder for approval.
That is followed by the constant back and forth with the stakeholder to get the invoice approved.
Sometimes, the AP team doesn’t know who needs to approve the invoice, which adds to the complexity.
Data entry for non PO invoices
The manual task of entering invoices in QuickBooks is time-consuming, especially when you have to wait for a stakeholder’s input to determine the appropriate chart of accounts.
If you don’t have a central place to capture all invoices, you probably have to spend time tracking down the invoice.
All these activities take time, increase the overall invoice processing time, and lead to delays in invoice processing.
With faster invoice processing, you increase productivity and are in a position to avail of any early payment discounts.
Note: ProcureDesk is our product, and we designed ProcureDesk to solve these three challenges. You can read about it in detail below or schedule a demo to see how it could help your AP team.
This article presents three accounts payable software options that integrate with QuickBooks Online and QuickBooks Enterprise.
ProcureDesk provides a complete AP automation solution for QuickBooks.
Though many solutions provide AP automation, our focus is to provide an integrated purchasing and invoicing solution so that you can completely automate the invoice and PO matching process.
When purchase orders and invoices are in one system, you avoid exporting and importing data from multiple systems to perform the 3-way or 2-way match for invoices.
Here are the key features of ProcureDesk that support AP automation
Still, receiving paper invoices?
Then ProcureDesk can help that by eliminating the need for paper invoices.
The first step towards AP automation is to get the invoices in one place and avoid scanning invoices.
There might be cases where you can’t avoid the paper invoice. For example, some utilities will only send paper invoices. There is not much you can do if they are the only player in the town.
So here is how to set up an invoicing process to avoid paper invoices.
1. First, get a dedicated email for receiving invoices, for example, email@example.com.
2. If you already have an AP email, you can use that for general communication with vendors, but invoices should have a dedicated email. This allows you to keep track of invoices easily, and you can also forward the invoices to ProcureDesk to automatically create the invoice from email.
3. You need to make sure that suppliers are aware of this new email. Here are a couple of ways to do that:
4. Once the invoices are in one place, ProcureDesk can read invoices from the email box and automatically create the invoice for you.
The invoices are then automatically imported for you.
You can see all imported invoices in the invoice queue.
With OCR, ProcureDesk can read the invoice documents and extract the relevant information from the invoice document.
The AP team doesn’t have to spend time entering the invoice data into the system. With OCR, human errors are avoidable.
All you have to do is verify the information so that the system can perform the 3-way invoice matching.
ProcureDesk OCR engine extracts the following information:
It includes invoice number, invoice amount, invoice date, taxes, and other relevant information.
It includes detailed line item information like item description, unit quantity, price, and other relevant details.
Here is an example of how the extracted invoice data gets populated into the invoice.
With Electronic invoices, you can eliminate the need for invoices.
That means the supplier doesn’t even have to email the invoice. The system automatically creates vendor invoices.
ProcureDesk has integration with 50+ vendors that support electronic invoices.
Here is how an electronic invoice process works:
Electronic invoices eliminate the need for the AP team to create and review invoices and provide complete invoice automation.
Here is an example of how ProcureDesk creates an electronic invoice.
Manual 3-way matching is painful but an important internal control. ProcureDesk makes it easier for you.
Once the system imports the invoice, it matches the invoice with the purchase order and receipt.
The 3-way match automation allows the AP team to focus on value add activities and not worry about spending time chasing stakeholders.
Here is an example of an automated 3-way match.
The system automatically routes the invoice for further review in case of any issues.
For example, If a receipt is missing, the system will automatically send an email to the order contact, requesting that they create a receipt or provide feedback.
Let’s take another example – you ordered the product at a $10 unit price, but the vendor sends you an invoice with $11. We call this price mismatch.
For cases like this, you can automate the process so that the system routes the invoice to a buyer for further review.
Alternatively, you can send the invoice to the stakeholder who created the purchase order.
If you purchase services instead of tangible products, you need a 2-way match process.
With a 2-way match, the system automatically matches the invoice with the purchase order.
Since there is no receipt, the system will automatically route the invoice to the respective stakeholder for further review and processing.
The stakeholder review is important because you want someone to confirm if the vendor performed the work per the agreed scope and quality.
Here is an example of a 2-way match where the system routes the invoice to the correct stakeholder.
If the invoice amount is more than the purchase order amount, you can set up additional approvals for additional spending.
The biggest challenge for AP is to code the invoices to the right chart of accounts, cost codes, etc.
Since the AP team doesn’t know what is purchased and by whom, it is difficult to assess the correct cost codes.
If you have a PO, this step is not required because the system can automatically code the invoice based on the coding present on the purchase order.
However, for the invoices without the purchase orders, the AP team has to manually review each invoice and assign the respective chart of account.
There are a couple of ways to use auto-coding to reduce the time spent processing invoices.
With the supplier-based auto-coding rules, you can set up the default cost codes by the supplier. For example, you want to assign an “office expense” code to a supplier irrespective of who is purchasing the product.
User-based auto-coding is helpful when certain users always purchase a certain product. For example, a lab manager might always purchase lab supplies so that you can assign a cost code of “Lab Supplies” for all the purchases made by the lab manager.
In a self-learning mechanism, you can train the system to remember certain cost codes for a specific use case.
The system can then prompt you to see if you want to use those cost codes again.
Over time the system remembers your preference and uses that as a mechanism to auto-code the invoices for you.
A common scenario for many growing companies is that they lack a consistent purchase order process.
I.e., employees are not creating purchase orders for each purchase.
That leads to surprise invoices showing up, and the AP team needs a mechanism to process such invoices.
Non-PO invoices are not preferred, but they are part of the day-to-day operations.
ProcureDesk provides an easy way to route such invoices for approvals so that you can have the appropriate stakeholders approve the invoice.
A flexible approval workflow engine provides multiple ways to set a workflow.
For example, if it is a facility rent invoice, you might want to route it to the facility manager.
If it is a utility invoice, you might not need any approval.
Here is an example of an approval workflow for a non-PO invoice.
You can set up invoice types in the system and then define the workflow for each invoice type.
You can also assign the invoice to the correct budget so that no matter how you purchase the product or service, you can always track spending against the set budget.
With Dashboard and reporting, you get complete visibility into your spending and cash flow requirements.
For example, you can see what you are purchasing, from whom and who are your top spenders in the company.
Here is an example of the spend dashboard:
ProcureDesk has 30+ reports to provide your detailed transaction summary.
For example, You can easily track all the pending approval invoices.
You can track what invoices are missing receipts so that the AP team can follow up and have the stakeholders confirm the delivery of the product.
Here is an example of a report that shows you all invoices pending receipts.
Accounts payable automation aims to reduce the time spent entering and approving invoices.
So it doesn’t help if the accounts payable software is not compatible with QuickBooks.
ProcureDesk automatically syncs vendor Bills with Quickbooks after the supplier invoice (Bill) is approved for payment.
The process is real-time with QuickBooks Online(QBO), and the Bill is instantly available in QBO.
For the QuickBooks Enterprise (Desktop) version, you can set up a schedule based on how often you want to sync the data from ProcureDesk. The system runs an integration program on the set frequency and pulls the data into QuickBooks.
Bill.com allows companies to track, approve and pay vendors.
Bill.com is a payment platform that allows you to capture supplier invoices and then pay using the same platform.
It is best suited for companies that don’t have much purchase order spend. If all you need is a simple system to approve invoices and then pay the vendors, Bill.com is the best option. The solution doesn’t support 3-way matching, but you can perform 2-way matching in the system.
Here are the key features of the Bill.com platform that support the AP automation use case for QuickBooks.
Using the Bill.com inbox feature, you can receive all supplier invoices in one place.
Bill.com assigns you an email address that you can pass to your vendors. All the incoming invoices are then available in Bill.com Inbox.
The AP clerk can then index each invoice and submit it for approval and payment.
Here is an example of Bill.com Inbox.
Bill.com automatically extracts the invoice header data for you.
The common fields include:
Bill.com doesn’t support line-level data extraction, so it is up to the AP clerk to copy-paste the line-level data from the invoice document to the invoice.
Bill.com handles the non-PO invoices use case very well, but the invoice matching process is missing.
Customers use Bill.com and ProcureDesk to get the invoice matching capabilities and then pay the vendors using the Bill.com platform.
If you are looking to have a PO number from QuickBooks so that you can assign it to an invoice, Bill.com solves that use case very well.
You can import approved purchase order numbers from QuickBooks (Online and Desktop) into Bill.com and then assign them to the invoice.
But the system doesn’t import additional information like purchase order line items and so on.
Bill.com has a flexible workflow engine that allows you to set up custom workflows to suit your approval needs.
You can choose to directly pay the invoices without approval or have an approval process.
The AP team can set up the approval process for individual users or invoice groups.
Bill.com supports a 2-way sync with QuickBooks.
That means the information syncs from Bill.com to QuickBooks, or you can import the approved invoices from QuickBooks to Bill.com for payment.
The QuickBooks integration is covered in detail here.
Stampli provides a complete AP automation solution that supports invoice processing and payments using Stampli Direct Pay. The payment platform supports payment via ACH and checks.
The use case is very similar to Bill.com. Stampli is best suited for companies who don’t have much purchase order spend.
If you have purchase orders, there is no capability to match the invoice and purchase orders.
You can still use Stampli, but you either need to manually approve the invoices or have a different solution for invoice matching.
Key features of Stampli that support Accounts payable automation are as follows:
Stampli provides a central inbox for capturing all supplier invoices.
Each customer is assigned a unique email inbox. The customer can then communicate the new email to the vendor.
Stampli only accepts PDF documents, and the system rejects any other attachment type.
Once the system uploads the invoice, Stampli allows you to add additional supporting documents.
Stampli provides OCR capabilities to extract the invoice date from the PDF attachment automatically.
Stampli AI Bot extracts the data, which the AP clerk can review for accuracy.
The corrections made by the AP clerk are remembered for the next time so that you don’t have to correct the same issue again.
It is not clear from the Stampli website whether the OCR engine supports both header and line-level extraction.
Stampli is designed around scanning and processing invoices. When writing this article, we didn’t see any mention of invoice matching on Stampli’s website. Best to ask the vendor about this capability.
Stampli supports invoice approvals.
The AI bot can automatically assign the approvals based on pre-set conditions or reviewers.
The system also sends reminders to the approvers so that the AP team doesn’t have to follow up with approvers to get the invoices approved on time.
The benefit of the auto-coding feature is that it reduces the time spent processing the invoice.
With auto-coding, the system automatically assigns cost codes and GL codes to the invoice based on the predefined rules.
Stampli supports Bill integration with QuickBooks so that you don’t have to sync the invoice data to QuickBooks manually.
Stampli supports integration with QuickBooks Online and QuickBooks Desktop.
Similar to ProcureDesk and Bill.com, Stampli also supports sync of master data like Vendors, Gl accounts and supports bill sync with QuickBooks.
This article covered three accounts payable software compatible with QuickBooks Online and QuickBooks Desktop.
By using the ProcureDesk accounts payable automation solution, our clients have achieved the following:
So what’s next?
If you are curious to see if ProcureDesk can help with AP automation using QuickBooks, Click the button below to schedule a demo.