Top 6 AP automation features for your business

Is accounts payable automation software worth the investment?

You may have heard of the benefits of AP automation: cost savings, better visibility into invoice status, faster approvals and payment processing, and reduced errors and missed payments. But do you know which AP software features maximize efficiencies for your business?

In this article, we’ll help you understand your options for automating accounts payable. We’ll explore the different AP automation software solutions and which features finance leaders say are the most important for them and their teams. Then, we’ll walk you through the most common use cases to help you choose the best feature set for your business.

Let’s get started.

What is accounts payable automation?

AP automation refers to software solutions that automate previously manual accounts payable workflows associated with invoice and payment processing. In essence, accounts payable software is intended to replace repetitive manual tasks and let accounts payable departments manage large invoice volumes more efficiently.

What are the benefits of accounts payable automation?

In 2023, Stampli and Probolsky Research surveyed roughly 250 CFOs, finance leaders, and AP employees on the major benefits of AP automation. Here are the five most important benefits of accounts payable automation they identified:

• Improving accuracy: AP automation reduces erroneous, duplicate, and missed payments.
• Improving processing speeds: By eliminating manual, paper-based tasks, AP automation reduces processing time and makes approvals and payments faster.
• Deeper/faster data analysis: Accurate, real-time data and analytics give you better visibility into invoice status, team performance, and cash flow – making it easier to detect fraud and errors.
• Cutting costs: AP automation improves employee productivity, so you can process invoices faster and scale your business without hiring more staff.
• Improved financial system efficiency: Seamless ERP integration, real-time data sharing, and customizable workflows boost accounting efficiency across the board.

By delivering on these benefits, leading AP solutions like Stampli help businesses take control of their spending. “Stampli has allowed our manual AP process to be automated…which has more than doubled the capacity of our AP clerk,” says one treasurer. “It has allowed for greater control and insight into company expenditures as well as reporting features that have been useful for our CFO and CEO to user productivity which has allowed our AP clerk to analyze and find users causing backups in the approval process.

“The approval process itself has become incredibly simplified for department managers, and from a financial policy standpoint, we can start to fix holes in our approval process that have been there for years.”

How do you automate AP processes?

There are several different ways to automate AP processes.

Many ERPs and accounting software solutions offer basic accounts payable functionality, such as vendor invoice management and reporting, yet keying in invoices is still manual. These automation tools can be useful to small and medium-sized businesses with simple AP needs and a small volume of invoices. However, to add advanced functionality like invoice coding, approval routing, or payment processing, you often need to upgrade to a higher-priced version or purchase additional modules.

Financial automation platforms, such as BILL, also offer AP automation features as part of their basic offering. However, as with ERPs, these solutions often fail to meet customer requirements and only offer advanced AP features at higher-priced tiers.

Other AP automation platforms, such as AvidXchange, provide bundled AP features like invoice processing, approval routing, and payment management, offering more functionality than ERPs or financial automation platforms. Although many of these solutions automate core AP processes, they may lack the flexibility to adapt to your unique business needs, forcing you to change your processes or find manual workarounds. For example, some Tipalti users report chronic sync issues when integrating with ERPs.

AI-powered automation platforms, like Stampli, are built for AP productivity first. They leverage AI and machine learning to learn and understand your organization, business processes, and cost accounting rules. Because they are built with the needs of AP departments in mind, these platforms provide a high degree of automation with no changes to your existing processes or rework of your ERP — and no need for workarounds.

What are the features of AP automation?

AP automation handles core tasks like invoice entry and coding, invoice matching, approval routing, payment processing, and recording AP transactions in the accounting system. Here are the 6 most important features to consider when choosing an AP solution.

1. Customizable AP workflow engine

The workflow engine automates repetitive manual AP tasks like invoice scanning, GL coding, and approval routing suggestions. Automating these tasks improves process efficiency and lets you validate, approve, and pay invoices with confidence faster. It also lets you scale your AP processing as your business grows without adding additional headcount. 

Most solutions come with fixed workflows with limited customization to meet your business needs. Leading solutions let you build your own workflows such as custom routing for invoice approvals.

Dynamic workflows with AI

Fixed workflows must be manually updated if your business processes change, a process that can tie up IT resources.

AI-powered AP solutions learn your workflows and adapt over time to make your AP more efficient. Stampli’s AI assistant, Billy the Bot, learns your processes to automate and optimize coding, invoice matching, and approval routing. That way, when processes change, or someone goes on vacation, Billy notices the change and adapts to it.

“The best aspect of Stampli is its seamless automation of the accounts payable process,” says one customer review. “The intelligent invoice processing and approval workflows have significantly streamlined our operations, saving time and reducing manual errors.”

2. Invoice data capture and GL coding

Most AP solutions automate invoice data entry and coding using document capture and optical character recognition (OCR) capabilities to scan paper invoices. Some solutions include advanced invoice processing features such as automated general ledger (GL) coding of invoice details. Invoice automation is faster and more accurate than manual data entry, which helps eliminate late or erroneous payments.

Machine learning optimizes invoice processing

Many ERPs only have limited AP functionality when it comes to automation such as OCR, and far too many accounts payable automation solutions only automate certain invoice processing functions, leaving AP teams to manually perform tasks like GL coding. Other solutions automate invoice data entry and coding but don’t have automatic duplicate invoice detection.

AI-powered AP solutions like Stampli use machine learning to make invoice processing faster and more accurate. They learn your existing data entry and coding processes and automatically extract and GL code invoice details. If the AI is unsure of a data point, it doesn’t hallucinate and won’t make something up. Moreover, Stampli will automatically flag any duplicate invoices, ensuring you don’t double-pay your vendors.

“Stampli has been so much easier to use than any other accounts payable program that I have used,” says a Stampli customer. “Stampli automatically fills in coding details if it recognizes and even suggests approvers. I still have the ability to change anything, which makes it even easier to use. I use Stampli every day whether it is to code invoices, answer questions, or check the status of invoices.”

3. 2- and 3-way invoice matching

Some AP automation platforms claim they “automate” two and three-way invoice matching to detect invoice errors and prevent fraud. They often rely on rigid rules-based matching, leading to a complex and inflexible process.  This can cause delays, errors, and frustration for AP teams. Some ERPs and AP platforms also force users to switch between windows to check invoice details, while others can’t process partial invoices or POs, limiting these tools’ usefulness. 

AI provides flexible and intuitive matching

Stampli Cognitive AI™ PO Matching offers a smarter solution. It combines advanced AI technology with business logic to understand the full business context of POs and invoices. Cognitive AI can automatically match POs without manual intervention. It reaches the same conclusions as human operators over 97% of the time for complex scenarios such as inconsistent item descriptions, quantity mismatches, and split deliveries.

Stampli integrates with ERPs and accounting systems to automatically obtain and match invoice and PO details so you can access the ERP POs directly in Stampli on the invoice itself. “With Stampli, it’s possible to extract invoice data and match it with relevant purchase orders and receipts seamlessly,” said one Stampli user. “…we’ve been able to eradicate manual data entry altogether…its robust AI capabilities enable efficient reduction of scanning time and ensure accurate matching of purchase orders with incoming invoices.”

4. Communications and invoice status tracking

Broken communications can plague AP departments. Often, AP teams rely on emails, paper files, phone calls, and unintegrated business systems to process, approve, and pay invoices. As a result, communications are a mess — important documents fall through the cracks, invoices sit on approvers’ desks, and payments are made late or missed altogether.

Some AP automation platforms unify communications to help AP teams manage invoice processing. They track messages, manage documents, and ensure messages, such as approval requests, reach the right people. They also store invoices in a single place to make it easier to find documents and track invoice status.

The invoice as a communications hub

Leading AP solutions provide centralized communications features that go beyond messaging to build collaboration and streamline workflows. Stampli turns the invoice into a communications hub by centralizing communications, documentation, and tasks on each invoice. AP team members and approvers can confirm invoice details at a glance without needing to sort through emails.

One user says, “Stampli has also streamlined our communications around invoices. We used to have multiple email chains, notes handwritten on the invoices, etc., and now all communications are centralized. It’s cut down on the blame game, like so and so said this about the invoice, but the AP clerk didn’t record it, and now the info is lost.”

5. Internal controls and reporting

Most AP automation solutions enforce compliance with internal controls. For example, you can enforce separation of duties in most platforms by establishing user roles and restricting what each user can do. You can also set up approval limits to ensure high-value transactions reach the appropriate approver. Some platforms track and record transactions, user actions, and communications to help you keep a complete audit trail. Others provide reporting and analytics capabilities to help you monitor KPIs, track invoice status, and manage spending and cash flow more closely.

Centralized, real-time control improves processing efficiency

Although AP automation platforms provide internal controls and reporting capabilities, the effectiveness of these features can be compromised if the platform is overly complicated or if rigid user control policies limit an AP team’s ability to do its job. For example, many large ERPs feature strict organization structures and user roles that can prevent AP employees from accessing information they need to process invoices.

Moreover, it can be expensive to have approvers (and other stakeholders) as users on the ERP. As a result, companies often don’t register approvals as users. Instead, they require AP teams to obtain approvals outside the ERP system via email or in person. Going outside the ERP can put the business at risk if it doesn’t put internal controls in place to ensure manual approvals are tracked and recorded.

Advanced AP platforms capture the complete history and documentation for each invoice in one view, giving you complete visibility into the invoice status and audit trail in real time. Leading AI-powered platforms are also designed to enforce internal controls while minimizing the impact on AP teams’ access to needed information and resources. For example, Stampli’s AI helps enforce internal controls by learning your approval process and cost accounting rules. It acts as a true copilot for AI by seamlessly maintaining controls and doing the manual AP work while retaining human oversight of key decision points. Also, Stampli won’t charge you an arm an a leg to add approvers.

One Stampli customer explains how Stampli helped them maintain strong internal controls for multiple locations and remote employees after a merger. “Since we merged, we have focused on streamlining processes and struggled with figuring out how to work from multiple locations and remotely while still getting the work done and with the proper controls in place. Stampli has helped us do that by allowing all necessary staff to see the activity of an invoice along with a complete audit trail. Our auditors will be able to see this as well.”

6. Integration and data sharing with ERPs

AP automation solutions integrate with ERPs and accounting systems to share transaction data, ensure financial records are kept up-to-date, and reconcile bank statements with accounting records. Integration ensures that everyone in the organization is working from the same data and lets AP teams access the documents and information they need to process invoices.

Seamless integrations improve financial system efficiency

Leading AP platforms are easy to implement and integrate seamlessly with ERPs. Seamless integration lets AP teams focus on processing invoices rather than dealing with sync issues, finding workarounds, or navigating multiple windows. For example, Stampli’s pre-built integrations support ERPs’ full native capabilities with minimal coding or rework.

“One of the standout features of Stampli is its seamless integration with existing accounting systems,” says one reviewer. “Regardless of whether your organization utilizes QuickBooks, NetSuite, or another platform, Stampli seamlessly integrates, eliminating the need for manual data entry and ensuring data accuracy…With Stampli, gone are the days of lost invoices and delayed approvals – everything is centralized and easily accessible, enhancing transparency and accountability within the organization.”

How to choose the AP platform with the right features

Selecting the right AP automation software can be complicated, but it can be simplified by taking a strategic approach. Your first consideration when choosing an AP automation solution is to map your company’s long-term strategy and requirements against the benefits AP solutions can provide. Businesses have successfully used AP automation functionality to:

• Streamline existing processes without changing how they work.
• Streamline and optimize purchasing and approval workflows.
• Speed up invoice data capture and payment processing.
• Improve internal controls and transparency.
• Simplify the invoice or receipt to payment process.

Once you have a clear understanding of your current situation and future goals, you can look for AP solutions that offer features to meet your business needs.

Stampli: The only solution designed for accounts payable

Stampli is designed by AP professionals for AP professionals.

It’s the ideal choice for businesses needing a smart, fast, and flexible AP solution that provides advanced features and exceptional customer service — and delivers real results.

One controller describes how Stampli has transformed their accounts payable processing: “The ease of routing is unmatched. The ease of approvals for individuals within the organization is unmatched. It is a tool that has moved our company forward in both technology and increased productivity…With Stampli, we have decreased our days to process by over 3 days!!”

Industry-leading customer service

Stampli is the recognized leader in customer satisfaction in accounts payable automation. It is ranked #2 out of 3,400 in G2’s Best Accounting & Finance Software Products for 2024 and is recognized as a leader in numerous flagship reports, including Capterra’s Shortlist, SoftwareAdvice’s FrontRunners, GetApp’s Category Leaders, and TrustRadius Accounts Payable –Top Rated.

According to one customer, Stampli provides “The best customer service and support I have experienced during and post implementation! The customer service and quick response is impressive. I have not experienced this type of customer service with other products. This is truly what sets Stampli apart from other software products.”

Numerous case studies from happy customers recognize Stampli for excellence in several areas:

• Easy to use, intuitive interface.
• Fast and easy implementation and onboarding.
• Wide range of payment options.
• Integration with accounting software like Oracle NetSuite and QuickBooks Online.
• Streamlined workflows and approval processes.
• Audit trail providing transparency.
• Automated supplier onboarding.
• Excellent customer support.

Efficient and accurate accounts payable automation

Stampli’s AI assistant, Billy the Bot™, makes AP workflows simple. It automates tedious manual tasks like invoice capture, data entry, coding, matching, and approvals to help you save money and pay vendors on time.

One Stampli customer says “The AI technology (Billy the Bot) is a huge timesaver. How quickly he can learn invoices and provide suggestive coding has reduced our invoice entry time to a fraction of what it was…We process over 1,000 invoices a month where each had to be manually added to our ERP system which would take our staff days. Stampli has been able to reduce this entry time to a fraction of what it was – hours.”

See how Stampli transforms AP operations into a seamless process. Get a free demo today.