When it comes to working capital optimization, invoice reconciliation should be a core strategy. To effectively determine the right course of action when facing potentially conflicting outcomes, businesses must take a more strategic and collaborative approach to accounts payable and invoice reconciliation. Without a focus on this, companies face eroding supplier/retailer goodwill, resulting in slower delivery times, less willingness to address issues, slower responses to queries, and more onerous payment terms.
The goal should be to ensure that invoices are received, reconciled, and processed in a timely fashion with an emphasis on the importance of optimizing payables and freeing up working capital to fuel growth
Invoice Reconciliation Challenges
Timing Delays
Differing payment terms requires tracking the transaction lifecycle closely. One single deviation might not sound like a big deal, but when you’re managing this across multiple, constantly changing trading partners, that is a different story
Unstructured Data
Often, exchanges are done via unstructured formats like email or PDF. To identify exceptions requires endless manual checks which is unsustainable across a broad network of trading partners
Inaccurate Status
Managing invoice payment and allocation statuses handling via a manual process is chaotic – especially as quarter end nears - and increases the workload, errors and financial losses or balance sheet inaccuracies
