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5 essential steps of end-to-end accounts payable automation

Updated: Aug 24, 2022


If you are still running your accounts payable (AP) process manually, you are probably feeling increasing pressure to automate. Remote working and global uncertainty are pushing finance teams to become more agile.

Automation and digitisation are here to stay and companies around the world and across all industries are modernising their back office. Finance leaders unanimously agree - they want their staff to analyse data, not key in data. Manual data entry and spreadsheet reconciliations are not fit for purpose in a digital world and companies that remain stuck in the past will fall behind.

It's no surprise then that automation solutions and vendors are ubiquitous but they are not all created equal. Not all solutions automate every step of the accounts payable process. Some solutions simply address one or two steps but not the end-to-end processing of invoices.

In this article we cover how automation can be applied to each part of the accounts payable process. We cover how an end-to-end accounts payable automation solution addresses each of the following steps:

  1. Receiving the invoice

  2. Capturing invoice data

  3. Approving and authorising the invoice

  4. Paying the invoice

  5. Updating the general ledger (GL) in the accounting system


1 - Receiving the invoice

Manual process:

You typically receive the invoice after the supplier has already been validated and a purchase order (PO) has been raised. In most cases, the supplier sends the invoice after the goods or services have been delivered. You receive the invoice as a PDF attached to an email or - if you are dealing with smaller suppliers - even on a piece of paper.


With an automated solution all invoices are directly routed to a centralised inbox so suppliers can continue sending PDF invoices if they prefer. A more advanced solution includes an invoice portal that you share with your suppliers. Invoices are created in the web portal directly. Your finance team and suppliers work from the same data - bank details, payment terms, invoices - in the same place throughout the whole process. Shared portals significantly eliminate the need for keying data from documents into various systems and spreadsheets. The number of disputes and miscommunication also decreases with everyone accessing the same information.

Additionally, an advanced accounts payable solution includes supplier validation upon sign up to the portal. The supplier is verified as a legal entity - thus reducing the risk of fraud.

2 - Capturing invoice data

Manual process:

Capturing critical invoice data fields like the amount, date, supplier and PO number is a tedious undertaking. Staff have to find the email with the attached PDF, open the PDF and visually scan the document to find the relevant information. They then key in each field into the accounting system - one by one for each invoice! This is highly inefficient and extremely error prone. Not to mention, it's rather unsatisfying work.


A comprehensive automation solution includes built-in optical character recognition (OCR) technology that automatically scans and extracts the correct data from a PDF document. Be aware of two different types: template-based and AI-based OCR technology. Template-based solutions require you to set up a template for every PDF that is formatted differently. If you are dealing with hundreds of suppliers that have different document layouts, a template-based solution quickly becomes unviable. An AI-based solution on the other hand intelligently understands where to find the required information and is therefore more appropriate for dealing with large volumes of unstructured data.

Automating the data capture step of the process with an AI solution increases the efficiency and accuracy of your accounts payable process significantly.

3 - Approving and authorising the invoice

Manual process:

Once staff have laboriously keyed in all the information, the invoice needs to be checked and approved. If your business uses POs, this will involve matching the invoice to the corresponding PO number. Manual approvals will require you to email the invoice to the correct individuals. PO data is likely housed in another system and to perform the matching process your team has created a homegrown system made up of spreadsheets with more manual retrieval and formulas, creating even more inefficiencies and opportunities for error.


An end-to-end payables automation system reduces the workload in this step. PO data is pulled from the point of sale (POS), inventory or job management system and matched with the invoice data. Once the invoice is matched to the PO and the system confirms that the invoice amount matches the amount approved on the PO that invoice is approved and authorised for payment instantly - not a single human touch required.

For non-PO invoices, intelligent approval workflows immediately notify the approver with built-in reminders.

4 - Paying the invoice

Manual process:

Once payments are authorised in your accounting system, you create batch payments for the monthly payment run. Depending on your volume of suppliers and invoices, you may have to create multiple batches - each a separate CSV file - that you then upload to your banking system for payment. Here you go again - more spreadsheets to tie together fragmented processes and disparate systems. More spreadsheets = more chance of error = more inefficiencies.


Advanced payables automation platforms offer embedded payment processing. This means that you can directly authorise and schedule all approved invoices for payment within the platform. No need to export and move files from system A to system B.

While payments can simply be scheduled for the due date, the reduction in invoice processing time opens up the opportunity for early payment cost savings. This could be through taking advantage of early payment discounts that suppliers offer directly or reward programmes like earning cashback for early payments.

5 - Updating the GL in your accounting system

Manual process:

Everything is manually keyed into your accounting system one line item at a time. Once the payment is made the status is manually updated.


An end-to-end accounts payable solution, seamlessly integrates with your accounting or ERP software and updates all entries in real-time, correctly mapped to your chart of accounts.

The 5 steps of accounts payable automation

An end-to-end automation solution can streamline the whole process, meaning that the majority of invoices can be received, processed and paid without human intervention. This quickly reduces AP workload by 80-90%, freeing up your finance team to work on the reports and analysis that they usually never get to.

There will always be a small amount of invoices that cannot be processed straight-through. An automation solution can sort the invoices that cannot be matched and display them in a user-friendly interface that enables easy review and resolution of those exceptions.

In summary, an accounts payable automation solution can level up your finance team and provide a range of benefits:

Cut workload by 80-90%

Low value, time-intensive data entry and reconciliation tasks virtually disappear so your finance team will get their weekends and nights back.

Scale up and down

If you are growing quickly, an accounts payable automation solution can scale with the business without the need to hire more staff. On the contrary, if your business is impacted by seasonality for example, it is just as easy to scale down.

Reduce time to month-close

With shorter invoice processing cycles, you can close the books faster. Rather than rushing to process everything in time for period end, the workload is distributed more evenly across the month.

Eliminate errors

Human error is inevitable, particularly when dealing with numerous shared spreadsheets and double handling. Reducing your reliance on spreadsheets gives you more confidence in the accuracy of your accounting.

Retain talent

Employees want to grow their careers through learning and being challenged. By automating repetitive tasks, employees can focus their time on developing new skills.

Drive savings

Because invoices are processed in a timely manner, you can finally take advantage of early payment cost savings through discounts or cashback programmes.

At Relay, we're experts in accounts payable automation. If you are ready to start your finance automation journey, let's chat. Book a free consultation to find out how to get started.


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