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Blog March 21, 2016

Digitalk: Put a stop to incorrect invoices!

Businesses spend a considerable amount of time checking purchase invoices, a process which could be largely automated. Correcting mistakes in invoices ties up resources, and takes employees away from tasks related to the organization’s core business. Upgrading to automated purchase invoice processing allows businesses to focus on what matters.

We at Enfo have in the last couple of years analyzed the development potential of financial administration in almost forty businesses of different sizes. In most cases, we have found that the greatest potential for increasing efficiency lies in the organization’s purchase invoice processing.

Almost all the time spent on checking invoices is extra work resulting from various inconsistencies that could be eliminated.

A wide range of purchase invoice checking and approval systems have become available for businesses in the last few years. Controls and monitoring have improved as a result, but in many cases the checking of purchase invoices still falls on the company’s key personnel, who are consequently burdened with unnecessary financial administration routines instead of being able to focus on more meaningful tasks.

Another common problem is that invoices are approved and therefore paid irregularly, which leads to businesses having to pay late payment interest unnecessarily. The risk of human error and inconsistencies resulting from individuals’ different approaches to checking invoices are also an issue.

Choosing the right information system and using it correctly are naturally vital for successful automation. Automated processes have huge development potential, and tapping into this potential may require investment or switching to a different partner. Businesses also need to be proactive and demand a higher standard of invoices from their supplier. No process works if the input data are flawed.

One way for businesses to raise standards is to lay down clear rules on what kinds of invoices they are prepared to process. These rules can then be used to automate the approval of invoices that comply with the rules and to ensure that only mistakes that really require human intervention are flagged up and forwarded to the relevant person. For example, business should automatically reject invoices that do not show a purchase order number.

Financial administration staff have a habit of letting both internal and external suppliers off too easily in these respects, but accepting invoices that are missing key information means that suppliers never learn and the process cannot develop. 


A system that recognizes mandatory information and is able to match it against electronic invoices submitted by suppliers can also be programmed to automatically reject non-compliant invoices and inform both the supplier and the client of the rejection.

Many financial administration teams to whom I have suggested this when analyzing their financial processes have responded that such strict rules would be ill-received in their organization. However, laying down criteria for incoming invoices is a perfect example of a best practice that is not only easy to adopt but also a sure way to increase efficiency. To maximize the benefits, businesses need to complement this practice with a system that checks the correctness of invoices and issues requests for corrections automatically.

A realistic analysis of the efficiency of current processes and drawing up a development plan for the future not only save businesses a considerable amount of money each year but also make the work of financial administration a whole lot more meaningful.

The author, Senior Consultant Roope Rauhalinna, helps Enfo’s customers maximize the efficiency of their financial processes and free their human resources for tasks that genuinely support their business.

Enfo ZmartFinance is a comprehensive, user-friendly system for digital financial administration in the 2010s. We help our customers identify the strengths and weaknesses of their financial processes and provide tangible solutions for automating routines.