What is Invoice Approval? 

Invoice approval is the straightforward process of reviewing and authorizing invoices from suppliers before making payments. This stage of invoice processing typically includes matching invoices with relevant documents.

Invoice approval process (without automation software)

While the specific steps may vary between companies, for the purpose of this page and explaining the general process (without AP automation software), invoice approval looks as follows:

  1. Receive the invoice from the supplier.
  2. Match the invoice with other relevant documents, such as purchase orders.
  3. If the invoice can't be correctly matched with a purchase order, it must be assigned to someone, often the purchasing manager, to resolve the issue and re-enter the approval process.
  4. After successful matching, invoices are sent to the responsible authority for approval, like the department head or CFO.
  5. Once approved by the designated authority, the invoice is forwarded to the accounts payable team for payment.
  6. Once paid, the invoice can be closed.

Invoice approval rules

Each company has its own approval structures and processes, known as invoice approval rules. These rules often depend on seniority approval within the company and the invoice amount. Managers may have a higher approval limit than executives, and directors may have an even higher limit.

Additionally, there might be supplier-specific clauses where senior employees need to approve transactions with certain suppliers, while less senior employees can approve larger purchase amounts with whitelisted vendors. These rules can be integrated into accounts payable automation solutions, ensuring invoices are only approved based on pre-defined criteria.

Invoice approval software

Invoice approval software is an integral component of an automated accounts payable (AP) ecosystem—it transforms manual, paper‑based approval workflows into digital, error‑resistant, and far faster processes. Leveraging AI and machine learning, like Basware’s InvoiceAI, it intelligently routes invoices to the right people at the right time, reducing delays and enhancing compliance.

Unlike traditional approval steps that rely on email or paper, modern solutions capture invoice data with 100% accuracy using technologies such as SmartPDF and automated e‑invoicing networks. This data is automatically matched to purchase orders or budgets; exceptions are flagged, and the rest proceed straight through, often touchless, delivering results up to 30× faster than manual methods. Built‑in audit trails and tax‑compliance engines ensure visibility and control across the entire lifecycle.

By eliminating manual coding, matching, and follow‑ups, invoice approval software significantly lowers invoice processing costs and minimizes errors and duplicate payments. It also improves supplier satisfaction by enabling quicker payments and capturing early‑payment discounts. Integration with ERPs and global invoicing regulations ensures all approvals are compliant and consistent, regardless of where your business operates.

In summary, invoice approval software delivers accuracy, speed, compliance, and efficiency—empowering finance teams to focus on strategy, not paperwork.

Accounts payable invoice approval software

As a core part of accounts payable automation, invoice approval software streamlines the entire AP process, from invoice capture to payment. It ensures timely approvals, supports global compliance, and integrates seamlessly with your ERP system, helping AP teams reduce risk, cut costs, and gain real-time visibility into cash flow and liabilities.

Explore more about invoice approvals

To learn more about invoice approvals and how Basware AP Automation takes the manual, guesswork out of your business, get in touch with a team member. Alternatively, explore our other AP Automation guides for valuable insights and industry best practices.