Is Automated Invoice Software a Real Solution?

This article will discuss when and how to invoice capture software can use to replace manual data entry. We will discuss how invoicing software works and the methods that lead to accurate data.

Why invest in automated invoice scanning software?

Digitalization continues to be a success story in the workplace. The days of paper filing cabinets, which used to take up valuable office space in the form of small warehouses, are gone. Nowadays, digital business processes mean that printing documents are no longer the norm.

Invoices received today are mostly in digital format (PDF, scanned photo, email, and, It streamlines business processes and eliminates physical storage space. However, there is one problem: How do you leverage the data in these digitized invoices.

How can you access the key data stored in digital invoices, and how do you move it to its rightful place?

Automated Invoice Capture Software is here to help. Every invoice contains key information vital for business intelligence, resource planning, accounting, and accounting. Invoice data must transfer to ERP, accounting, or data analytics systems.

Invoice Capture Software, also known as Invoicing Software and Invoice Recognition Software, is a customized data entry solution that caters to the specific use case for invoices. It recognizes all the key fields in your invoices, making it easy to manage structured data.

You can easily reuse your PDF invoices in other applications once they are converted to an Excel spreadsheet. You no longer need to manually re-key invoice data from PDF into your ERP system.

What accuracy is an invoice scanner?

Computer systems have difficulty extracting fine-grained information from invoices in different formats. Although machine learning and artificial intelligence have made great strides in recent years, it is still difficult to identify complex patterns like invoicing line items.

It is important to have a realistic understanding of how to invoicing recognition software can benefit you. Asking important questions is, for example:

• Is the invoice a PDF document or a scanned image?
• Are all the images scanned aligned perfectly, and are they of good quality?
• Are you required also to process receipt photos?
• Do you need more detail?

The big question that comes to mind when you look at the above questions is: How reliable, and accurate are invoice scanning solutions?

The short answer is: It all depends… Continue reading for the longer answer.

Automated invoice processing software can be a viable option.

The problem of automated invoice processing has not been solved. While there are technical limitations, modern invoice scanning and processing solutions can offer excellent results when your use case falls within these two categories.

• Scan recurring invoices from a small number of suppliers and vendors

Many businesses receive invoices from a small number of suppliers. Businesses may receive hundreds of invoices per month from just a few suppliers. It is true, especially for brick-and-mortar businesses and eCommerce shops and the wholesale, food, and shipping industries.

Automated invoice processing can be a great way to streamline your business’s workflow if you have hundreds of recurring invoices. It’s easy to train invoicing software.

When training an invoice OCR software, the key thing to do is to define the location where the key data fields should be placed. After training, any future invoices with the same layout will be recognized.

The invoice processing software will automatically extract the data in a structured format that is fine-grained for further use. 

This method also allows you to extract line items from invoices. It allows you to extract metadata like the invoice date, number, and totals and provide detailed information about the merchandise in an invoice.

It is particularly useful if you need to input fine-grained data in an ERP system or perform advanced number crunching.

This method extracts data with near-perfect accuracy. There is no need to validate data manually (see below). Watch our screencast to see how Docparser creates invoice parsers.

• Extract metadata from invoices, such as date, invoice number, and total.

It is difficult to train a computer system for every invoice format when there are hundreds, if not thousands.

Intelligent filters can use instead of training OCR scanner software for invoices based on data points’ positions.

Instead, they can search for specific data fields at variable locations. These filters identify entities like numbers and search for common keywords near them. The total invoice amount could calculate by using the keyword “Total Due” followed by a dollar amount.

Keyword-based extraction is very effective for most metadata fields, such as totals, tax, total, invoice date, number, etc. It is less reliable to extract line items from a table. It is because line item tables can be in different formats and include different data types.

What are the most common reasons invoicing scanning solutions fail?

Invoices scanning solutions can fail when there is a lack of information about the invoice layout and fine-grained data (invoice items). Although artificial intelligence is being used to solve this problem, data accuracy is still poor.

Nevertheless, modern solutions work best when the invoice format is known. However, this limitation can come by adding human data validation to your process.

A hybrid model that combines automation and human validation can overcome the limitations in invoicing data extraction.

One common way to overcome the limitations of OCR systems for automated invoices is to use a hybrid model. This method involves letting a computer system do all the heavy lifting and then manually validating the data.

Some invoices processing software solutions include a data validation interface that allows humans to flip through invoices and validate or correct any errors quickly.

Is there a better alternative to automatic invoicing scanning?

A standard called Electronic Data Interchange creates over 30 years ago to avoid the problems associated with invoice scanning and accounts payable automatization. It was simple in principle: Instead of exchanging invoicing using a human-readable format and transferring transactional data from company A to B in a machine-readable form, the idea was to automate this process.

The need to manually validate or type transactions is eliminated by letting machines communicate directly with each other. Although EDI was a success in large organizations, most SMEs still receive invoicing in paper or PDF format. They are desperate to find alternatives.

If you only process a few invoices per month, manual data entry is possible in-house. You should consider outsourcing if you need to process hundreds of invoices and don’t want invoice capture software. Outsourcing can also be problematic due to data security, processing times, and finding a service provider overhead.

Let’s sum it all up…

Your use case and the solution you choose will determine whether your invoice automation project is successful.