Invoice management – the best case scenario
When all’s said and done, invoice management is what TEM is all about. That means keeping on top of your payments, checking for errors, and maintaining useful records. It may sound pretty straight forward, but mistakes are easily made, and they are usually due to a lack of standardisation and a failure to anticipate problems.
In this series, we have already discussed the importance of workflow management and maintaining good inventory records and the good news is that if you’ve mastered these two tasks, you will find invoice management a breeze.
What is invoice validation (when it’s done right)?
At its most basic, invoice management is the act of weighing up inventory records against invoices. If they match up, they get paid and you move on to the next one. If they don’t, you investigate until the issue has been sorted out.
But it’s not enough to merely aim for the most basic function. If you want to be on top of your TEM game, you have to think one step ahead.
You should already have bespoke processes and solutions in place to allow you to manage your standalone workflow management and accounts payable function and those two systems should be connected to each other and kept constantly up to date.
When you receive a supplier invoice, the worst-case scenario is that you simply pay the invoice and don’t validate it against this internal database. However, it is also worth noting that if your internal database is a standalone entity, it will not be doing anything to help you improve your efficiency across the board.
The best-case scenario is that you already have an up-to-date workflow management and inventory management system in place when you receive a supplier invoice. You simply input the information from that invoice, along with very basic information such as the account number and cost centre. This triggers the system to pull out all the inventory and past invoices associated with that account number and you will then have all the information you need to validate the invoice.
If the figures don’t add up, your TEM solution should be able to raise a dispute against those line items and track this correspondence with your supplier until either the invoice has been corrected or a credit note has been received.
Why is it important?
In TEM, you are dealing with outages, queries, upgrades, downgrades and numerous other issues on a day-to-day and month-to-month basis, and invoice is likely to look different. It is extremely unlikely that you will see any sort of consistency across your incoming invoices, particularly the ones which list lots of different accounts or circuits on one account number.
Standardisation is the key to understanding your data processes, so if you can create a connection between your workflow, inventory and invoice management, you can take the guesswork out of invoice validation and allow the system to do all the hard work for you. Over time, a reliable invoicing system will also help to confirm taxation and payroll liabilities between your organisation and your suppliers.
Good invoicing processes will reduce bureaucracy, allow you to capture relevant accounting information, and standardize your payment system, ultimately adding to the overall efficiency of your entire company.
Click here to discover “Five ways Telecoms cost transparency aids your business”.