Updated Dec. 15, 2015
We all know that businesses can increase business performance by leveraging their Accounts Payable departments. Through accounts payable automation, companies can not only cut costs but also eliminate routine tasks within the organization.
Automate handling of invoices based on purchase orders
Companies can automate a large proportion of their invoice handling using modern accounts payable solutions. For invoices based on purchase orders, Basware Purchase-to-Pay can automatically manage the invoice process based on the PO information, and process the invoice touchlessly.
Automate recurring payments using payment plans
Typically, 10-20% of all invoices are recurring, periodic purchase invoices that do not have a corresponding purchase order available to use as the basis for automation. These invoices are perfect candidates for automation, but are often not automated because accounts payable departments do not know which are recurring payments – cost center owners do.
Whether the recurring invoices are rents, leasing, security, or telecommunication bills, Basware Purchase-to-Pay provides an easy way to share this knowledge with the accounts payable department so that these invoices can be automated using a payment plan. Once a payment plan is in place, companies will never have to touch these invoices again.
Figure 1: Accounts Payable has full visibility and control of payment plans
Basware Purchase-to-Pay can propose payment plans
Earlier this year, Basware introduced a new way to identify recurrence in the volume of purchase invoices. Basware Purchase-to-Pay automatically recognizes similar invoices from a supplier within set gross total tolerance. Once a defined number of occurrences have been recognized, users are presented an option to take action for higher automation.
The Accounts Payable department also receives notification about these possible recurring payments. They are presented with the option to create a payment plan directly from the notification.
Figure 2: Basware Purchase-to-Pay automatically proposes a new payment plan based on invoice information
3 types of payment plan to choose from
Basware Purchase to Pay enables easy identification and automation of recurring payments. When a cost center owner realizes that a given invoice is a recurring invoice, he/she can flag it to the AP department. It can then be put under one of three types of payment plans:
Type 1: Schedule-based payment plan
Schedule-based payment plans are used when the supplier sends an invoice with the same content at regular intervals. A typical case is a rental invoice which is sent once a month with the same sum and reason - as per rental agreement. Businesses can define the payment schedule, as well as the expected invoice sum.
Type 2: Budget-based payment plan
Budget-based payment plans can be used to automate invoices arriving at an irregular intervals. This is an excellent fit for managing invoices related to a project that involves several purchases, and which has a set budget for total spend. The payment schedule includes the budget period and details about the quantity and sums of the expected invoices.
Type 3: Self-billing payment plan
The self-billing payment plan can be used in cases where the supplier does not send invoices to the buyer, but instead the buyer pays the supplier according to a pre-defined payment schedule. The self-billing payment plan contains the agreed payment schedule with payable amounts, invoice dates, due dates, and other necessary information. Basware AP Automation solution automatically generates these invoices and transfers them for payment.
Figure 3: Cost center managers can propose a payment plan based on an individual invoice
Setting up a payment plan is easy
Setting up a payment plan is easy. Any user reviewing or approving an invoice can propose a payment plan based on an individual invoice. The AP department then creates a recurring payment plan and sends it back for approval. As soon as the plan is in place, suppliers include a reference number their invoices, and the invoices can be processed automatically.
Observe and measure the benefits of automation with Basware Analytics
By combining the power of automated recurring payment plans with Basware Analytics – a reporting solution for Basware Purchase to Pay - customers of Basware can ensure that their business KPIs are met in accounts payable automation.
To learn more about payment plans or other features of Basware Purchase-to-Pay solution, contact us »